Pakistan fails to meet International Monetary Fund (IMF) loan conditions again

With Pakistan failing to meet three out of the five targets fixed by the International Monetary Fund for the second review of the $7 billion bailout package, India’s stand has been vindicated that Islamabad has been a prolonged borrower, with a very poor track record of implementation and adherence to the IMF’s programme conditions  Pakistan’s Federal Board of Revenue missed two major fiscal targets as it failed to collect 12.3 lakh crore rupees in total revenues and generate 50 billion rupees under the much-hyped Tajir Dost Scheme aimed at taxing retailers. The scheme is reported to have turned out to be a dud, leaving the unorganised economy unchecked, according to a report in Pakistan’s Express Tribune newspaper. The fiscal operations summary released by Pakistan’s Ministry of Finance also shows that the provinces fell short of saving the targeted 1.2 lakh crore rupees in the last fiscal year, which ended in June, due to higher expenditures. India has opposed the loans as inflows from international financial institutions, like the IMF, could be misused by Pakistan for military and state-sponsored cross-border terrorist activities. However, the IMF’s response is circumscribed by procedural and technical formalities. “This is a serious gap highlighting the urgent need to ensure that moral values are given appropriate consideration in the procedures followed by global financial institutions,” India’s representative Parameswaran Iyer said at the last meeting of the IMF. Last September, the Executive Board of the IMF approved a 37-month Extended Arrangement under the EFF for Pakistan in the amount of SDR 5,320 million (or around $7 billion). While there was an immediate disbursement of $1 billion, the meeting on Friday was called to review the funding programme for Pakistan. (IANS)

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