Prime Minister Shehbaz Sharif has expressed his optimism that Pakistan, which has fulfilled "all the preconditions" of the IMF, will still be able to sign a staff-level agreement with the global lender to revive the stalled bailout programme for the cash-strapped country.
Sharif's remarks came as many believe that Pakistan's chances for the revival of the current $6.5 billion IMF programme have almost diminished before it expires on June 30. Out of the $6.5 billion package, the IMF has not yet disbursed $2.6 billion to Pakistan.
Addressing a ceremony here on Sunday, Sharif still appeared optimistic about that deal with the global lender and while referring to the government’s plan B, said, “If the agreement with the IMF is (further) delayed, then I will address you.”
The International Monetary Fund (IMF) signed a deal in 2019 to provide $6 billion to Pakistan on fulfilment of certain conditions.
The plan was derailed several times and the full reimbursement is still pending due to insistence by the donor that Pakistan should complete all formalities.
“Pakistan has fulfilled all the preconditions and is hopeful that the agreement with the IMF will be signed during the current month,” Sharif said.
“There is no need to be nervous... We have met all conditions of the IMF, removing obstacles in finalising an agreement with it,” he said but added a note of hope that he had talked with the IMF chief who assured that the agreement will be signed this month.
He also said that "no hurdle is now left" in signing of a staff-level agreement between Pakistan and the IMF.
“If the IMF agreement is delayed, I will appeal to the people of Pakistan,” he added, without elaborating.
Sharif blamed the previous government for the current economic crisis, saying that former prime minister Imran Khan's Pakistan Tehreek-e-Insaf (PTI) government violated the agreement with the IMF.
“The PTI government had all its focus on sending the opposition to prisons,” he added.
He said that the “fascist regime of the PTI” which came into power due to “rigged 2018 elections” put all development projects on halt. “All Chinese projects were cancelled and no development was made during the PTI’s four-year term.”
During the coronavirus pandemic, Sharif said, gas prices had hit rock bottom but the then PTI government did not avail this opportunity. The PTI government focused on pushing its opponents against the wall.
He said the inflation rate soared so high that it had become impossible to make both ends meet even at Rs 50,000 per month earnings. “Despite the difficult economic situation, the government is trying to give relief to the salaried class,” he added.
Since 1958, Pakistan has signed 22 IMF programmes but failed to complete all, barring the 2013-16 facility, thanks to nearly 18 waivers from the global lender.
Islamabad signed the current 36-month $6 billion Extended Fund Facility in July 2019, which, on request of the then-finance minister, Miftah Ismail, was extended by the IMF by nine months to June 30, 2023, and its size increased to $6.5 billion.
Over the past almost four years, the programme has been derailed at least four times, including on two occasions during the tenure of the current coalition government, and the failure to complete it will further widen the trust deficit between the country and the financial world.
The prime minister told the ceremony that the May 9 violence was no less than an attack by the enemy. “In 75 years of the country’s history, nobody ever attempted to attack the army installations,” he said.
“The law will take its course against those who attacked the Jinnah House at the instigation of the PTI chairman. Those involved in the (May 9) incidents will get exemplary punishments, so nobody could dare repeat any such incident,” he said.
The prime minister underscored that the country could not get economic stability without political stability, saying that the Pakistan Muslim League-Nawaz (PML-N) party would bring political and economic stability under the leadership of his elder brother Nawaz Sharif.
“Rest assured that the time will come that Pakistan will be back on track of economic development under Nawaz Sharif and I will continue to serve the nation till my last breath,” he concluded.