Finance Minister Ishaq Dar has alleged that the International Monetary Fund wanted Pakistan to become Sri Lanka, which defaulted on foreign debt last year, for the loan programme that the country hopes would be finalised this month.
“We can’t believe everything IMF says,” the Pakistan Television Network quoted him as saying in a meeting of the Senate Standing Committee on Finance on Thursday. “They want us to become Sri Lanka, default, and then negotiate.”
The reaction came hours after the international lender slammed the cash-strapped country’s budget for the financial year 2023-24, saying that the outlay “missed an opportunity” to broaden the tax base.
Pakistan has barely enough currency reserves to cover one month’s imports. It had hoped to have $1.1 billion of the funds released in November - but the IMF has insisted on a number of conditions before it makes any more disbursements.
The country was expected to present a budget in line with programme objectives, restore the proper functioning of the foreign exchange market.
“Pakistan is a sovereign country. We have national interests. On IMF’s request, we cannot impose a ban on giving discounts to young people in IT,” the state broadcaster further quoted Dar as saying at the meeting. He again spoke about the geopolitics that according to him was also delaying the deal.
In order to unlock funding under its long delayed 9th review, Pakistan is required to secure firm and credible financing commitments to close the $6 billion gap. The government has only been able to get commitments of $4 billion, mainly from Saudi Arabia and the United Arab Emirates.
The country has also rolled over debt from China as its reserves reach critical levels.
Read: Why has the IMF been so strict on Pakistan this time?
Later, Dar told reporters that talks with the IMF were not failed. He dispelled such assumptions that the ninth review was difficult for the country.
The finance czar reiterated that the deal would be signed this month. According to Dar, everything was in order and arrangements were ready. “All payments are being made.”
Many experts were of the view that Pakistan would again have to approach the IMF if it fails to complete the programme. They have also pinned such possibilities as the main task for the next government after elections, which are expected to be held in October.
