IMF review mission visit likely in first week of March

ISLAMABAD: Amid slow disbursements of foreign loans from international creditors, IMF review mission is scheduled to visit Pakistan in the first week of next month for holding review parleys under $7 billion Extended Fund Facility (EFF).

The smooth sailing of first review of IMF sponsored programme is considered quite crucial, as Islamabad will have to seek waivers on unfulfillment of certain conditionalities. Islamabad will also have to evolve broader consensus on major contours of next budget for 2025-26 with the IMF staff.

If both sides failed to evolve consensus, completion of first review might be linked with approval of budget from the parliament. As agreed, the first review and approval of a $1 billion tranche by Executive Board of IMF is scheduled to be done by April 2025.

Disbursement of foreign loans for Pakistan stood at $4.5 billion in the first seven months (July-Jan) of current fiscal year 2024-25 against $6.7 billion in the same period of last year. After incorporating IMF loan amount, total disbursement of foreign loans went up to $5.5 billion. However, it remained less than the projected loan inflows of $19 billion for the whole current financial year.

The IMF review mission is expected to visit Islamabad from March 4 at a time when the current account has turned from surplus to a deficit month-on-month (MoM) basis, as it posted a deficit of $420 million in January 2025.

“Yes, IMF review mission will be visiting Islamabad in the first week of March”, one top official of finance ministry confirmed when The News sought his comments on Tuesday.

Sources said Pakistan might have to seek waiver for missing out deadline on getting approval on Agriculture Income Tax (AIT). Although four provincial assemblies granted their assent, the deadline could not be materialised. The Wealth Fund and Asset Declaration Scheme related legislation could not be done so far.

The Tajir Dost Scheme (TDS) could not bring desired results. The FBR had claimed increased number of retailers filed their tax returns during current fiscal year.

Foreign Loans Disbursements: Pakistan has fetched dollar loan inflows of $4.584 billion during the first seven months of current fiscal year.

The multilateral creditors disbursed $2.32 billion in the first seven months, out of which ADB remained largest partner. Manila-based lender disbursed loans of $1.04 billion. China’s commercial bank disbursed $306 million, AIIB $60.22 million, EIB $10.53 million, World Bank’s IDA $573.8 million, WB’s IBRD $201.5 million, IsDB $265.72 million, IsDB $134.19 million and OPEC Fund $14 million.

All the bilateral creditors disbursed $329.1 million in the first seven months of current fiscal year, out of which China provided $99.17 million, France $102.5 million, Germany $26.09 million, Japan $12.7 million, Korea $24.4 million, Saudi Arabia $12.37 and US $40.05 million.

Pakistan could not launch any international bond, as it had projected to fetch $1 billion. However, government was able to secure a commercial loan of $500 million. Through the Naya Pakistan Certificate, government so far generated $1.126 billion in the first seven months of current fiscal year.