As Pakistan met all conditions by IMF, Country is about to get a bailout package of $7bn. The Board of China Development Bank (CDB) has approved a $700m credit facility. In addition to CDB, more inflows from multilateral lenders and friendly countries expected. Finance Minister Ishaq Dar stated that the money will boost the State Bank of Pakistan’s (SBP) foreign exchange reserves. Country’s foriegn exchange reserves currently sit at $3bn, an amount that can only cover three weeks of controlled imports. Pakistan has to raise its forex reserves to a minimum of $10bn to cover a two-month import bill. With hopes for inflows from China, Saudi Arabia, and the UAE after signing the staff-level agreement with the IMF on February 28. The IMF executive board meeting will take place in the first week of March.
In compliance with the IMF’s last condition, the Prime Minister Secretariat sent the Finance (Supplementary) Bill 2023 to the President Secretariat for assent. The bill was sent two days after being passed by the National Assembly on February 20. However, as a money bill, the president has no power to object to it. President house confirmed to receive bill on Wednesday evening.
US Ambassador met Dar
US Ambassador to Pakistan Donald Blome met with Finance Minister Ishaq Dar to discuss both countries’ economic relations. Mr Blome expressed confidence in the Pakistani government’s policies and programmes for economic sustainability and socio-economic development, while Mr Dar reiterated the desire of his government to deepen bilateral trade and investment ties with the USA.
Following assent from President Arif Alvi, Rs55bn tax measures will come into effect. The Federal Board of Revenue (FBR) will raise general sales tax from 17% to 25% on more than 800 non-essential imported items, mostly food and cosmetics. The FBR will implement the remaining measures via SROs. The new finance bill also empowers the federal government to increase goods’ GST rate on retail level without parliament approval, a power that previously rested with the parliament.
