Pakistan in discussions with IMF for 24th ‘Extended and Increased’ bailout package: Report

Pakistan is currently in talks with the International Monetary Fund (IMF) for a 24th bailout programme under the Extended Fund Facility (EFF), as reported by ARY News. The IMF confirmed that negotiations are ongoing for a ‘longer and larger’ bailout package, with a mission team led by Nathan Porter meeting with Pakistani authorities this week.

IMF Communication Director Julie Kozack stated that the IMF Executive Board recently completed the second review of the stand-by arrangement for Pakistan, allowing a disbursement of about USD 1.1 billion. She praised Pakistan’s strong policy efforts during the standby period, which helped stabilize the economy.

Pakistan is seeking a bailout package of USD 6 billion to USD 8 billion for three to four years to address its financial crisis. The IMF’s technical experts’ team arrived in Pakistan on May 10 for talks on a new loan programme and budget preparations.

However, Pakistan faces economic challenges, including a failed tax amnesty scheme proposed by the IMF. The IMF has urged the Federal Board of Revenue to revoke discretionary powers in granting tax incentives and make amendments to tax laws for NGOs, charitable organizations, and taxed pensioners. The IMF also calls for the removal of special tax regimes in the construction sector to enhance tax efficiency.

The ongoing negotiations between Pakistan and the IMF will determine the terms of the bailout package and the measures Pakistan must take to stabilize its economy.