IMF team to visit Pakistan from March 14-18: Report

Islamabad: An IMF team is expected to arrive in Pakistan within the next 24 hours for talks with the new finance minister Muhammad Aurangzeb, days after a new government was formed in the cash-strapped country following days of political uncertainty.

Aurangzeb, who took oath as the finance minister on Monday said that his priority was to start negotiations with the Washington-based International Monetary Fund.

“No debates, no waste of time — just a steadfast commitment to implementation,” the professional banker, told the Dawn newspaper after being sworn in at the President's House on Monday.

The new Pakistan government led by Prime Minister Shehbaz Sharif assumed office last week after the inconclusive elections.

The former Karachi-based Habib Bank Ltd (HBL) chief is the third banker to hold the position of finance minister in the country, after Shaukat Aziz and Shaukat Tarin.

His appointment as the new finance czar was a departure from the ruling Pakistan Muslim League-Nawaz (PML-N), which has traditionally persisted with Sharif family confidant Ishaq Dar at the helm of the economy on four occasions.

The IMF has decided to dispatch its team to Pakistan to hold talks before releasing the third tranche of its already agreed USD 3 billion assistance, the report said.

The team would arrive by Wednesday night and hold talks with officials during its stay from March 14-18, it said, quoting sources.

Aurangzeb said that Pakistan would persist in its discussions with the IMF officials to secure the release of the final tranche of the soon-to-expire USD 3 billion loan package.

He attributed the successful negotiation of this deal to Prime Minister Shehbaz Sharif, who secured it during his 16-month tenure at the helm of the previous Pakistan Democratic Movement (PDM) government.

“Had this deal not been secured, the current economic landscape would have been markedly different,” he noted.

The standby agreement inked last year would end next month and Pakistan urgently needed another loan to avoid a default. On the need for a new agreement with the IMF, Aurangzeb said that his team was poised to commence discussions for a fresh three-year arrangement to secure a substantial loan, with a minimum value of USD 6 billion.

“The exact amount of the package is yet to be determined,” he said, emphasising that there will be no delay in initiating talks for this new agreement with the Washington-based global lender.

Aurangzeb expressed his commitment to implementing all policies put into place by the caretaker government. “I must commend the policy measures of the caretaker government, which have helped improve economic indicators,” the report quoted him as saying.

Meanwhile, Aurangzeb also stressed the need for a clear and decisive plan for privatisation, as per the newly-elected Prime Minister Shehbaz Sharif's instructions, the report said.

“We are left with no choice but to execute a robust privatisation plan,” he said, emphasising that this was the only viable strategy to create some fiscal space.

The minister assured that his economic team will take measures to minimise government expenditures and also enhance revenue collection.

On the exchange and policy rates, Aurangzeb acknowledged that while these matters primarily fell under the purview of the State Bank of Pakistan, there was no restriction on engaging in discussions with the central bank on these vital economic indicators.

Drawing a parallel with the US, where the Treasury and Federal Reserve, despite having different mandates, engage in dialogue as part of economic policy formulation, he suggested that a similar approach could be adopted between the finance ministry and the State Bank in their respective domains.

“I foresee more stability in the exchange rate due to the steady improvement in economic indicators,” he said, expressing optimism about an improvement in the policy rate in the coming months, the report said.