Concerned over the sharp rise in budget deficit, IMF team to visit Pakistan on Sep 16
IMF team expressed serious concerns over the sharp increase in a budget deficit that was wrongly projected by the Finance Ministry.
IMF is sending SOS mission to Pakistan from September 16-20.
IMF team expressed serious concerns over the sharp rise in the budget deficit from 0.6pc to 1.8pc.
Due to the Failing and worsening condition of Pakistan’s economy International Monetary Fund (IMF) has decided to send its SOS (Save Our Soul) mission to Pakistan this month for recommending techniques and methods to decrease the huge budget deficit.
The IMF team will visit Pakistan from September 16 to 20 and discuss the fiscal matters with a focus on targeting the deficit within the desired limits, Teresa Dabán Sanchez, IMF Resident Chief in Pakistan, confirmed to the source.
IMF team expressed serious concerns over the sharp increase in a budget deficit that was wrongly projected by the Finance Ministry at the time of the IMF deal. The deal gave Pakistan a loan of $6 billion under the 39-month Extended Fund Facility (EFF).
The fiscal targets, most specifically primary deficit has been calculated massively wrong. IMF put the condition of decreasing primary deficit from 1.8pc of GDP to 0.6pc of GDP in the current fiscal year.
Fiscal targets estimated wrong:
Now the primary deficit has immensely increased to 3.6pc of GDP and no one has any idea how to make adjustments of Rs1300 billion and reduce the primary deficit to 0.6pc of GDP.
“When the basis of IMF program has shaken what is the guarantee that the envisaged targets for the current fiscal year will be materialized”, the IMF side raised a question.
In response to that Pakistani team explained that FBR has faced some problems due to policy issues and falling of the economy.
“On the current fiscal year targets, the FBR told the IMF team that they would be going for annual tax collection of Rs5.5 trillion. The FBR could collect Rs425 billion to touch the psychological barrier of collecting Rs1 trillion in the first three months of the current fiscal year” added Pakistani team.
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