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Tuesday, May 21, 2024  
12 Dhul-Qadah 1445  

Major changes expected in real estate sector as Pakistan, IMF begin final talks

Pakistan assures IMF of expediting privatisation programme: sources
The seal for the International Monetary Fund (IMF) is seen in Washington DC, US. AFP/File
The seal for the International Monetary Fund (IMF) is seen in Washington DC, US. AFP/File

Pakistan has assured the International Monetary Fund of bringing the real estate sector into the tax net, sources said as the talks between the two sides for the last tranche of $1.1 billion under the stand-by arrangement enter the final round.

The last round of talks between the IMF and Pakistan will take place today (Monday). However, earlier reports have also suggested that the IMF delegation could extend its stay to March 21.

Under the plan, all housing societies would be registered and tax would be increased for non-filers in the purchase and sale of properties.

They added that the IMF asked the government to promote bank transactions instead of hard cash for purchasing properties.

The budget of the new financial year will include measures related to the real estate sector and the government would try to create coordination between the federal and provincial governments for taxes on the real estate sector.

Expediting privatisation programme

Pakistan has assured the International Monetary Fund of expediting the privatisation programme, sources within the finance ministry said on Sunday, as the two sides hold takes for a second review of the country’s stand-by arrangement.

Finance Minister Muhammad Aurangzeb is leading the talks during the talks with the lender for the last tranche of $1.1 billion under the nine-month $3 billion loan programme.

The South Asian country, in a deep economic crisis, agreed in June to overhaul loss-making state-owned enterprises under a deal with the IMF for a bailout.

The outgoing caretaker government approved a privatisation plan for loss-making Pakistan International Airlines, but some experts were of the view that such plans have not proved to be successful in the past.

The national flag carrier had liabilities of Rs785 billion and accumulated losses of Rs713 billion as of June last year. Its CEO has said losses in 2023 were likely to be Rs112 billion.

Sources within the Finance Division told Aaj News that the work on the PIA privatisation plan was under way in a “positive way” and hoped for its early completion.

As many as 25 state-owned entities – including four institutions each from financial and real estate sectors, two from industrial, 14 of power, and State Life Insurance – were on the list of active list of privatisation, they said.

They went on to add that at least 10 national power plants like Balloki, Haveli Bahadur, Guddu, and Nandi were part of the programme. House Building Finance Corporation, First Women’s Bank, Pakistan Engineering Company, and Sindh Engineering Limited are also on the list.

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