ISLAMABAD: The revival of International Monetary Fund’s (IMF) stalled $6 billion Extended Funding Facility (EFF) programme now hinges on the government’s ability to get the polemic State Bank of Pakistan (SBP) Amendment Bill 2021 passed from Senate within next 48 to 72 hours, The News has learnt.
The government wants the upper house to clear the bill in its existing shape. The ruling elite had somehow managed to railroad the bill through the National Assembly, the lower house, despite massive resistance from the opposition benches. This situation leaves the ruling PTI-led regime with no other option but to move ahead for getting immediate Senate approval by ensuring no major amendments are incorporated in the existing bill.
The treasury benches may opt for getting the bill passed without forwarding it to Senate Standing Committee on Finance and Revenues. However, the opposition parties are devising their own strategy for foiling any effort to railroad the SBP's Amendment Bill in haste.
In case of failure to get the Senate approval, the IMF programme will fall into the category of non-starter, because the Fund’s Executive Board has convened its meeting in Washington DC on January 28, 2022, for considering Article IV consultation, Sixth Review Under the EFF and requesting for waivers of Non-Observance of Performance Criteria and Rephasing of Access for Pakistan.
In case of approval with major changes in the bill, the government will have to revert back to the National Assembly or convene the Joint Session of Parliament to grant its assent for forwarding it before the president for final signature to enforce the bill as an act of Parliament.
Two top functionaries of the government, including a federal minister, confirmed to The News on Monday, on condition of anonymity, the approval of both Houses of Parliament was among the prior conditions of the IMF on the SBP Amendment Bill 2021. Both top officials were confident it would be done within the stipulated time-frame.
However, none of them explained how the government would pull off this feat at such a short notice. The IMF staff had tied the completion of Sixth Review and release of $1 billion tranche under EFF to the approval of mini-budget and SBP's Amendment Bill 2021.
The government managed to pass the Tax Laws Supplementary Act from the National Assembly and abolished the General Sales Tax (GST) exemptions and imposition of 17 percent GST on hundreds of imported and other locally manufactured items. They also jacked up tax on cellular subscribers and increased tax on vehicles. On mini-budget, the Senate can only forward its nonbinding recommendations to the Lower House of Parliament and it is the discretion of the National Assembly to pass the money bill.
The government also passed the SBP’s Amendment Bill from the National Assembly’s Standing Committee on Finance and then from the Lower House with a majority amid deafening opposition protest.
Now there will be defining moments when the government is going to seek approval of the Senate within the next 48 to 72 hours.
When contacted, PPP leader and Senator Saleem Mandviwalla said the SBP Amendment Bill should be referred to the Senate Standing Committee on Finance for detailed deliberations. He said if the government made efforts to railroad the SBP Amendment Bill, then it would have to face defeat because it the bill could not be passed without voting.
Senator Saadia Abbasi of the PMLN said the SBP Amendment Bill was circulated among members but it had yet not been laid out in the Senate yet. She said the PMLN would propose major changes in it when it would be referred to the Senate Standing Committee on Finance and Revenues. When asked about their strategy if the government railroaded it through the upper house, she replied they would sternly oppose it. Abbasi said they would raise the issue on a point of order that the commercial banks could consider default on the loans taken by the government. “This is very dangerous instruction and we will take it up in the Senate,” she said.