ISLAMABAD (Eshfak Mughal): Pakistan and IMF officials have started dialogues under the 1st review meeting of the Stand By Arrangement loan program today in Islamabad.
Government economic team and IMF delegation have held introductory session in the Finance Ministry on Thursday.
Sources said that the Caretaker Finance Minister Dr Shamshad Akhtar and Nathan Porter have led their delegations in introductory session.
Earlier, the IMF mission head Nathan Porter reached Pakistan late night with high level delegation on Thursday.
The IMF mission will remain till November 16 for the review ahead of the second tranche under the $3 billion Stand By Agreement (SBA).
The Pakistani officials briefed the visiting delegation about the economic indicators during the introductory session. They informed the IMF delegation that the Federal Board of Revenue has achieved the assigned target of tax collections. The govt has also spent funds on social safety protection under Benazir Income Support Program (BISP).
The authorities have also informed that the market based exchange rate will be enforced in future.
The Fund is expected to discuss the deteriorating fiscal position which has been heavily affected by debt servicing. The debt servicing has consumed the government revenue in the first quarter of the current financial year.
The IMF might raise the sustainability of such a tight fiscal position at a time when the government released development spending of just Rs.40 billion. The government has allocated Rs950 billion in budget. It has restricted subsidies at Rs.2.5 billion against the budgetary allocation of over Rs1,002 billion.
Debt servicing consumed Rs1.4 trillion in the first quarter of the current fiscal year with the policy rate at 22%.
The finance ministry officials believe that a downward revision of the policy rates is on the cards. The economic managers have been planning for financing a budget deficit on preferably longer periods.
The official claimed that the debt servicing bill would be curtailed within the allocated limit of Rs7.3 to Rs7.5 trillion for the current fiscal year.
Pakistan likely to get $710 million after the successfully conclusion of 1st review meeting with IMF.