Pakistan’s much-anticipated $7 billion bailout package has not yet been scheduled for review by the International Monetary Fund (IMF) executive board, with the agenda extending only until August 30, according to the IMF’s recently released calendar.
In July, Pakistani authorities and the IMF reached a staff-level agreement, potentially paving the way for a 37-month Extended Fund Facility (EFF) valued at SDR 5,320 million (approximately $7 billion).
However, this agreement hinges on the approval of the IMF Executive Board, which is contingent upon Pakistan securing necessary financing assurances from its development and bilateral partners.
The proposed programme is designed to build on the hard-won macroeconomic stability achieved in the past year. It aims to strengthen public finances, reduce inflation, rebuild external reserves, and eliminate economic distortions to foster private sector-led growth.
Despite five weeks having passed since the staff-level agreement, Pakistan has yet to bridge an external financing gap of up to $5 billion.
This delay has prevented the country from signing the Letter of Intent (LoI) required to formally request the IMF executive board’s approval of the $7 billion package under the EFF programme.
The LoI is a critical step in requesting the IMF’s endorsement of the 37-month, $7 billion EFF programme. Without this approval, Pakistan cannot proceed with the much-needed financial support.
The newly elected government of Pakistan has indicated its intention to secure a new loan from the International Monetary Fund (IMF).
In line with this, representatives from the IMF are scheduled to visit Pakistan for the second review of the ongoing Stand-By Arrangement (SBA). The review is set to take place from March 14 to 18 in Islamabad.
According to a statement released by the finance ministry, Pakistan has successfully met all structural benchmarks, qualitative performance criteria, and indicative targets required for the IMF review.
This upcoming review marks the final evaluation of the SBA, with a staff-level agreement anticipated upon its completion.
Once this agreement is reached, the final tranche of $1.1 billion under the SBA will be disbursed, subject to approval from the IMF’s Executive Board.
Last summer, Islamabad secured a vital rescue package from the IMF, preventing a potential sovereign debt default.
The successful completion of the final review is expected to unlock approximately $1.1 billion.
Prime Minister Shehbaz Sharif has instructed his finance team, led by newly appointed Finance Minister Muhammad Aurangzeb, to begin preparations for seeking an Extended Fund Facility (EFF) once the standby arrangement concludes on April 11.
The IMF has expressed readiness to develop a medium-term programme if Pakistan submits an application for one.
Notably, the government has not officially disclosed the amount of additional funding it intends to seek through a successor programme from the IMF.
Pakistan and the International Monetary Fund (IMF) recently discussed the country’s energy sector losses and efforts to reduce circular debt during a virtual meeting. The government is committed to adjusting fuel prices and quarterly tariffs to eliminate circular debt accumulation.
According to The News, a new plan called the Circular Debt Management Plan (CDMP) was shared with the IMF. This plan involves revising fuel price adjustments and quarterly tariffs upward to counter circular debt growth. The IMF expressed concerns about the plan’s sustainability due to slower recoveries.
The government was advised to create an effective strategy to tackle this issue. The meeting took place virtually on a technical level. The newly appointed Finance Minister, Dr Shamshad Akhtar, is expected to hold a virtual meeting with the IMF team soon.
The IMF’s first review is scheduled for October or November and will be based on economic data from the initial quarter (July–September) of the current fiscal year.
Pakistan and the IMF signed a $3 billion bailout package under the Standby Arrangement in July 2023. Pakistan has already received $1.2 billion, with two more reviews planned to release the remaining $1.8 billion by March or April 2024.
The State Bank of Pakistan (SBP) has received a substantial deposit of $1.2 billion from the International Monetary Fund (IMF), offering a glimmer of hope to the economically strained nation that has been on the verge of default for an extended period.
This deposit follows the approval by the IMF’s executive board, during a late-night session, of a nine-month programme under a $3 billion Stand-By Agreement (SBA). The agreement, reached after arduous negotiations over fiscal discipline lasting eight months, marks a significant milestone for Pakistan.
Last month, Pakistan successfully reached a staff-level agreement with the IMF, securing a short-term pact that exceeded expectations in terms of funding for the country, which is home to 230 million people. This achievement is of particular importance given the acute balance of payments crisis that Pakistan faced, with its central bank reserves barely sufficient to cover a month’s worth of controlled imports.
During a televised address from Islamabad, Finance Minister Ishaq Dar expressed that Pakistan will receive the remaining balance of the agreed amount following two reviews. The first review is scheduled for November, while the second review will take place in February.
These reviews are crucial milestones that need to be met to ensure the disbursement of the funds by the IMF, thus supporting Pakistan’s pursuit of economic stability.
Pakistan is in the midst of a balance of payment crisis, and the stakes are high. Without the financial aid of the International Monetary Fund (IMF), the country faces the prospect of defaulting on its external payment obligations.
Unfortunately, reports say that the IMF is not convinced by the assurances given to them by Pakistan’s friendly countries.
Officials of the finance ministry, speaking anonymously, have confirmed that Pakistan has fulfilled several conditions set by the lender for the revival of the loan facility, and the staff-level agreement on the ninth review was supposed to be signed by February 9.
However, the delay in the IMF programme could have severe repercussions. The budget planning, which is expected to be tabled in the second week of June, is likely to be affected.
Moody’s Investor Service has warned that Pakistan may default if it does not receive a bailout from the IMF as its financing options beyond June are uncertain.
While Pakistan is expected to meet its external payments until the end of this fiscal year in June, its reserves are weak and without IMF support, it could default.
Pakistan is struggling to restart a stalled $6.5 billion bailout programme from the IMF due to the government’s failure to meet some loan conditions, and political tensions ahead of elections are adding to the risk of a delay in the loan.
An engagement with the IMF beyond June would support additional financing from other multilateral and bilateral partners, which could reduce default risk. Pakistan’s foreign-exchange reserves remain very low, standing at $4.5 billion, and sufficient to cover only about one month of imports.
S&P Global Ratings estimates that Pakistan’s gross external financing needs as a proportion of current-account receipts plus usable reserves will rise to 139.5 per cent in fiscal year 2024 from 133 per cent in 2023.
S&P analysts believe that an IMF programme would be a foundation for important fiscal policy reforms and that an agreement on the current review cycle could instill more confidence for other bilateral and multilateral lenders to Pakistan.
The International Development Committee (IDC) of the British Parliament has called the UK’s financial support for disastrous floods in Pakistan ‘risible’.
The “pathetically small” amount of support provided, according to IDC chair Sarah Champion, made her feel ashamed. She further said that by choosing to take the money out of Pakistan’s current aid, the UK was really doing nothing for Pakistan.
According to Independent, the contribution of up to £1.5 million announced last week, according to IDC chair Sarah Champion in a letter to foreign secretary Liz Truss, equals less than 5p for each individual impacted by the heavy rain that has devastated more than 700,000 homes.
As soon as parliament reconvened on Monday after its summer recess, she requested Ms Truss make an urgent statement regarding the calamity.
The response to the floods, according to Ms Champion, revealed Boris Johnson’s administration policy of continued apathy towards Pakistan, which has dropped from first to seventh in the list of countries receiving bilateral aid from the UK since 2019.
Last week, Lord Ahmad, a minister in the Foreign Office, expressed his thoughts and prayers for the millions of people impacted by the floods that have apparently inundated a third of Pakistan’s territory. “The UK stands with the people of Pakistan during this time of need,” he said.
And on Tuesday, Mr Johnson expressed his deepest sympathies for the Pakistani people, saying, “We have witnessed the destruction there, and it is truly heartbreaking.
“Pakistan is traditionally one of the biggest recipients of UK overseas aid. We will of course make sure that we send a fitting package commensurate with the vital relationship that there is between the UK and Pakistan and people’s natural sympathies with those who have been affected by the floods.”
However, Ms. Champion wrote to Ms Truss in her letter, saying, “Considering the scope and impact of the flooding, I was ashamed to read the government’s declaration of ‘up to £1.5m from the UK’ in humanitarian support on August 27, 2022.”
“Even if the full £1.5m were delivered, it would amount to less than 5p for each person affected.”
“Furthermore, that pathetically small sum will be subtracted from ‘existing support to Pakistan’. The UK government’s risible response to this humanitarian disaster arguably amounts to nothing.”
“However, UK aid funding to Pakistan has been cut dramatically. Pakistan has fallen to seventh in the list of UK bilateral aid recipients since it experienced the largest single decrease in any country budget.”
A Foreign Office spokesperson said that Ms Champion’s letter had been received and a response would be made in due course.
It is important to note that Ahsan Iqbal, Pakistan’s Minister of Planning, previously estimated that the cost of the flood damage could reach $10 billion.
In the western city of Herat, a nearby area is known as “one kidney village” as Afghans are willing to sacrifice an organ to save and feed their families.
The country’s financial situation has gotten worse after the Taliban’s takeover which has left tens of thousands of Afghans, jobless, debt-ridden, and struggling.
Nooruddin, 32 told Agence France-Presse (AFP) that he quit his factory job when his salary was slashed to $30 (Rs5,323) but after he was unable to find another one, in desperation, he sold a kidney as a short term fix.
He said he regrets it now as he can no longer work. “I’m in pain and I cannot lift anything heavy”, he added. Nooruddin was among eight people AFP spoke to who had sold a kidney— some for as little as $1,500 (Rs266,175).
Shakila is a mother of two and at the age of 19, sold her kidney for $1,500 to settle the family’s debt. AFP reported that a mother-of-three Aziza was waiting for her opportunity.
Aziza said, “If I don’t sell my kidney, I will be forced to sell my one-year-old daughter.”
The practice of selling an organ is unregulated in Afghanistan. A former top Afghan surgeon stated, “There is no law to control how the organs can be donated or sold, but the consent of the donor is necessary.” He added that they never investigate how or where the patient or donor comes from because it’s not their job.
The country is in dire need of foreign aid. Last month, United States (US) President Joe Biden signed an executive order to release Afghan assets worth $7 billion but Biden split the money between humanitarian aid for war-torn Afghanistan and a fund for September 11 attacks victims.
Yasir Hussain, Mikaal Zulfiqar, Ayesha Omar and Sabeeka Imam have stepped forward and raised their voice for veteran actress Naila Jaffery, who is currently battling ovarian cancer.
“TV walo yeh aap ki hi aik sathi adakara hain. Aur yeh apna haq mang rahi hain. imdad nahi,” wrote Yasir Hussain on social media.
The actor further said: “Fellow actor Naila Jaffery ki halat dekhny k baad bhi hum kehty hain k hamen khuda ka khouf hai aur hum aakharat se darty hain.”
“Ramzan main chanda aur signal pai bheek dene se kuch nahi ho ga. Hamen haq dena ho ga,” he added.
“It’s really time to take a stand on this,” said Mikaal sharing Yasir’s story. It is pertinent to add here that the Durre Shehwar actor has previously also demanded TV channels to pay actors for reruns.
Voicing her support, Ayesha Omar said: “Heartbreaking to see yet another senior actor and someone who has given so much to our industry suffering and reminding the government/industry giants about their due rights.”
Omar further added: “She’s absolutely right. Senior actors, especially those who don’t have family support and are undergoing long term treatments should be given royalties and financial support, if not all.
Sharing the video of Jaffri’s appeal, Sabeeka Imam wrote: “This is so heartbreaking.”
“I have worked with her and she is the sweetest person. Dear channel owners, please have it in your hearts to at least give her what she’s due,” said the model, adding: “I am certain Allah will reward you with more! Love you Naila Jee.”
This is so heartbreaking. I have worked with her and she is the sweetest person. Dear channel owners, please have it in your hearts to atleast give her what she’s due. I am certain Allah will reward you with more!!! LOVE YOU NAILA JEE!!! ❤ https://t.co/2aJOFZlYog
Ushna Shah also took to her twitter and said: “Royalties are meant to feed artists for life but in PK we are heartbreakingly forsaken. #NailaJafri shouldn’t have had to publicly request for what is hers on her cancer bed. Many artists have relied on the kindness of samaritan fans once their distress was made public.”
In another tweet, she wrote: “Artists deserve a royalties for their art, a retirement plan, a union, an insurance for difficult times, a dignified pension, like every other hardworking person on this planet.”
2/2 Artists deserve a royalties for their art, a retirement plan, a union, an insurance for difficult times, a dignified pension, like every other hardworking person on this planet.
In her appeal video, Naila had requested for compensation of her re-broadcasted dramas on PTV.
“For the last six years, I [have been tied to] hospitals, as well as illness and cancer,” said the veteran actor. “I have also not had my second round of chemo either because of persistent infection and during this time I wondered: ‘What if the government lends a hand in this? What if they set up some policies for older people from the arts and sports sector?’.”
She further said: “When I initially joined PTV, I would get royalties for re-run shows and while that amount was nowhere near enough, it was still something and I liked having a stream of disposable income on the side.”
“I have been confined to a hospital bed for six years now and while everyone has supported me, loved me, helped me, and motivated me I wish there was some way to gain royalties on some of my last re-run plays,” said the actor. “Though I understand that it might not look like a lot to many people, for people like me who stopped working years ago, this support becomes important.”
“I request and demand that something is done for senior artists in the future since it’s become harder and harder for us to manage,” requested Naila.
Later in the day, Yasir shared that someone reached out to him in order to the help the veteran actor.
“Zindagi mai pehli bar laga hai k social media ka kuch faida hai,” said Yasir. “Naila Jaffery jee k baray mai meri Insta story dekh k aik farishty ki call aai and now they are connected.”
“Alhamdulillah is mulk main bohot achy log bhi hain,” he added.
Meanwhile, the Sindh Government has announced that they will bear all medical expenses of the actor.
As per details, Sindh Minister for Culture, Tourism, and Antiquities Sardar Ali Shah, in a statement, said that his department would bear all treatment expenses of Jaffery.
Sardar Shah on Twitter announced that his department would bear all treatment expenses of Naila Jaffery. He said in his tweet: “Culture department will happily bear all her expenses .. can anyone share her contact number?
Culture department will happily bear all her expenses .. can anyone share her contact number?
In another Instagram story, Yasir said: “Shukria un tamam logoon ka jinhoon ney yeah royalty ka system iss mulk sey khatam kia warna aaj koi bhi fankar yeah bat na kar raha hota.”
Shehzad Roy is very popular in Pakistan as a singer and also for his social work. Some of his socio-political songs were also a big hit in the country.
One of Roys’s songs featured Wasu Khan, a man hailing from the Jaffarabad district of Balochistan, belonging to the labour class. He made an appearance in the songApne Ullo Kitne Tedhe. His narrartion in the song was liked by mana people.
After ‘Apne Ullo Kitne Tedhe‘s popularity, Wasu was featured in another song with Roy in ‘Beya Beya’ that was a tribute to the late folk singer Mureed Buledi.
But now as per a few posts doing rounds on social media, Wasu is in financial crisis after going through numerous health issues, and living in a rented house.
In an interview, he said that he is not only unable to pay his house rent, but he is also unable to provide his family with two meals a day. He hopes that his message will reach the authorities and they will help him.
His story went viral on the internet and people started to share how the star now needs our help.
اپ رابطہ کروا دیں۔۔ اُمید ہے شہزاد رائے کی ضرورت نہیں پڑے گی
شہزاد رائے نے تو اس کو گمنامی سے نکال کے ایک پہچان دی۔ اس کے بعد باقی لوگوں بشمول میرے، آپ اور حکومتی عہدیداران نے کیا کیا۔ شہزاد کی بجائے ہمیں اپنے گریبان میں نگاہ اور ہاتھ ڈالنے کی ضرورت ہے
Speaking to Urdu News, Wasu said that Roy is still in contact with him.
“Shehzad Roy has helped me a lot. He spent two lacs rupees on my treatment at Agha Khan Hospital and is still in contact with me,” said Wasu.
He added: “Shehzad had bought me a house that was destroyed in the floods of 2010 and later sold it for treatment.”
“ I now live in a rented house. Shehzad has given me a house, money, but my personal income is not enough,” he shared.
Shehzad Roy recently took to Twitter and posted a video of Wasu telling that he asled for the help from the government and did not want to bother Roy as he had already helped him a lot.
last ten years I was constantly in touch with Wasu til my whole family got Corona.He did not cal me,he said he didnt want to trouble me more & wanted help from the govt. So I hav come to Quetta to meet him,he asked me to take him to the CM,who v met,Here is Wasu sharing his story pic.twitter.com/HNtw76BSml
The United Arab Emirates (UAE) government has announced to give $200 million in financial aid to the Prime Minister’s Kamyab Jawan Programme.
UAE ambassador has made this announcement while meeting PM’s Special Assistant to Youth Affairs, Usman Dar. The financial assistance had been assured by the Crown Prince of the Emirate of Abu Dhabi Mohammed bin Zayed Al Nahyan during his recent visit to Pakistan.
The ambassador said Pakistani youth are talented and capable and UAE will cooperate for the development of the youth. He said practical steps will be taken soon for the Pakistani youth.
He also announced to start a youth exchange programme between UAE and Pakistan. A delegation of Pakistani youth will be sent to UAE where they will be trained with skills of entrepreneurship and artificial intelligence. Moreover, the UAE government has offered to Pakistani youth to partner in Dubai Expo 2020.
The ambassador admired the federal government’s practical steps for its young generation and UAE will provide opportunities to the skilled youth in the future.
Dar welcomed the financial assistance of UAE in the Kamyab Jawan programme. He said ‘PM Imran Khan has an aim to uplift the young generation. He added that a huge investment is being made on youth for the first time in the history of Pakistan. The young generation will play an important role in the national economy.’
