- June 10, 2023
Pak PM Shehbaz Confident of IMF Bailout after Revealing New Budget
Pakistan PM Shehbaz Sharif said the government has tackled the economic crisis despite internal and external threats to the country. (Image: Reuters)
Finance minister Ishaq Dar unveiled a new budget and said it is in line with IMF’s expectations.
Pakistan Prime Minister Shehbaz Sharif on Friday said he hopes the International Monetary Fund (IMF) will resume the stalled bailout programme highlighting that the nation met “all” conditions set out by the lender despite facing economic hardships.
“The ninth review will be complete soon,” Sharif was quoted as saying by GeoNews. He expressed relief while highlighting that Pakistan was able to reduce the current account deficit to 3.3 billion dollars despite internal and external hardships.
Pakistan finance minister Ishaq Dar on Friday revealed as PKR14.46 trillion budget for fiscal year 2023-24. No new taxes were introduced and the government foresees an economic growth of 3.5%, and banks on the IMF to release more bailout money.
The government shared the budget number with the IMF and Dar feels that the IMF will not raise any objections and the budget is in line with the programme requirements.
“We took and are still taking tough decisions which have rescued the economy from default,” Dar said, accusing the Imran Khan-led Pakistan Tehreek-e-Insaf (PTI) of hurting Pakistan’s economy. “The threat of default has been averted due to the tough decision of the government, and the fall in foreign exchange reserves has been slowed down,” Dar was quoted as saying by GeoNews.
The government in its new budget also increased the salaries of government employees by 35% and increased pensions by 17.5% for the next fiscal year 2023-24.
The government also proposed setting minimum wage at PKR32,000.
Former finance minister Miftah Ismail, a critic of Ishaq Dar, said the budget is “in line with the IMF’s expectation”.
“The IMF focuses on two things — primary deficit and primary surplus — and we are close to it as there’s only a difference of PKR125 billion,” Ismail said.
He, however, pointed out that Pakistan is borrowing to repay interest and not to spend. “The most worrying thing in this year’s budget is that our revenue receipts are PKR6,800 billion and the interest it has to pay is PKR7,500 billion which means that the government is borrowing money just to pay interest and not to spend which is called death trap,” Ismail was quoted as saying by GeoNews.
