Pakistan in Advanced Stages of Securing External Financing to Unlock $7 Billion IMF Loan

Pakistan is at an advanced stage to get external financing commitments which will help unlock the new $7 billion International Monetary Fund (IMF) program. The federal government expects to get final loan approval from the IMF Executive Board on time, Finance Minister Muhammad Aurangzeb said in a televised speech. Aurangzeb further said the government will not “take back” the proposed tax on traders; to boost the tax-to-GDP ratio to at least 13 percent. He said the current 8.8 percent tax-to-GDP ratio is not sustainable. The Finance Minister also committed to reducing the size of the federal government to cut expenditures. On the future of key lending rates set by the central bank, Aurangzeb said the expects the Monetary Policy Rate to decline with a reduction in inflation.