ISLAMABAD: International Monetary Fund (IMF) conveyed to Pakistan that it has received confirmation from Saudi Arabia on $ 2 billion in additional deposits, rekindling hopes of an early signing of agreement.

Islamabad has been negotiating with IMF since end of January for release of $ 1.1 billion from a $ 6.5 billion bailout package agreed upon in 2019. To unlock funding, government has cut back on subsidies, removed an artificial cap on exchange rate, added taxes and raised fuel prices. However, assurances from friendly nations for additional funds have delayed agreement. Sources confirmed that lender had informed Pakistani authorities about development and Fund staff seemed largely satisfied with latest confirmation. “Now Saudi authorities are all set to make public announcement, probably during upcoming visit of Prime Minister Shehbaz Sharif to kingdom,” report stated. Saudi envoy in Pakistan had also hinted recently during an interview that his country had always supported Pakistan in critical situations and good news would be shared soon. “Now all eyes are focused on UAE for getting confirmation on another $ 1 billion deposit from them, which may pave way for striking staff-level agreement (SLA) with IMF,” sources said.

Finance Minister Ishaq Dar is likely to visit UAE on his way to US where he is expected to hold talks on release of funds. However, there was still another stumbling block in way of signing SLA with IMF as Ministry of Petroleum, in consultation with PM Office had announced an unplanned cross-fuel subsidy for owners of motorcycles and cars up to 800cc, which needed to be scrapped at this stage.

Published in The Daily National Courier, April, 07 2023

Like Business on Facebook, follow @DailyNCourier on Twitter to stay informed and join in the conversation.