The international body has also asked Pakistan to go to FTA for other options with other countries instead of China.
ISLAMABAD: (Urdu Point/Pakistan Point News-Feb 14th, 2020) International Monetary Fund (IMF) has asked Pakistan to reduce its reliance of commerce and trade Beijing and look to other international options by signing agreements.
The IMF mission has made this suggestion during its visit to Islamabad on Thursday. The mission asked the government authorities to take measures to reduce the revenue-expenditure gap.
In its meeting with Pakistani officials, the international body to deliberate over revenue generation efforts as the FBR wanted more reduction in its revised target of Rs5,238 billion. However, the IMF wanted to see the plan aimed at removing distortions and expanding narrowed tax base on a permanent basis. According to the sources, the IMF is not going lenient over FBR's failure to maximize revenue efforts and the IMF insisted the government must take measures to correct the situation halfway instead of waiting for the next fiscal year.
The sources say that the IMF staff would find it hard to defend its position if it agreed with further reduction in the FBR target. On the other hand, if the FBR’s revised target remains intact at Rs 5,238 billion, which experts believed was impossible to achieve at the set deadline. They further say that IMF wanted Pakistan to cut down its reliance on China and contact FTA with other international partners. However, they say, Islamabad is not read to consider this position. Besides it, there is no deadlock and staff-level agreement would be finalalized very soon, said the sources while relying upon the background discussions.
IMF asked PTI government to increase electricity tarrif and also the gas tarrif but the government refused to accept this, saying that it is not possible at the current political situation. At this, PM Imran Khan has asked the relevant ministries for freezing their tariffs for a certain period, but the IMF questions that wisdom, saying the cash bleeding losses will not be curtailed if there is no cost recovery of energy utilities. “The IMF is asking for a viable alternate plan,” said the sources.
