The International Monetary Fund (IMF) has said that Pakistan needs to mobilise domestic tax revenue to fund much-needed social and development spending.
“I would say that one of the key elements of the program that the IMF is supporting in Pakistan, Pakistan’s program, is the need to mobilise domestic tax revenue to fund much needed social and development spending while placing debt on a firm downward trend,” IMF Director Communications Gerry Rice said when asked if Pakistan can be advised of cutting subsidies and development spending to keep the primary deficit in line. “And this was actually something that our acting Managing Director David Lipton emphasized in his recent meeting a short time back with Prime Minister Imran Khan,” he told a press briefing.
The director also confirmed an earlier report of an IMF mission visiting Islamabad to hold talks on fiscal matters with the policymakers. “Let me add that we expect an IMF team to be in Pakistan in the next few days, including our Director for that area Jihad Azur will be there,” he added.
The IMF’s Executive Board on July 3 had approved a three-year bailout package worth $6 billion to Pakistan. On July 10, Pakistan received the first tranche of loan of $991.4 million from the IMF under the under Extended Fund Facility (EFF). According to the State Bank of Pakistan (SBP), following the loan from the IMF, the country’s foreign exchange reserves now stand at above $15.0431 billion.
