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The International Monetary Fund(IMF) and Pakistan have agreed on terms for a $6bn bailout package to be disbursed to Pakistan over a span of more than three years.
Earlier,Pakistan had asked the IMF to bail itself out from a severe financial crisis that threatens to cripple the country’s economy. Pakistan has already received financial aid packages from countries like China,Saudi Arabia and the UAE during the current fiscal year.
The IMF has said the bailout conditions agreed upon are (a)increasing government revenues and reducing spending (b)bringing down the primary fiscal deficit in Pakistan’s upcoming budget.
The programme also include tax policy revenue mobilisation measures to eliminate exemptions, curtail special treatments, and improve tax administration.
It will also target Pakistan’s loss-making state-owned enterprises and the country’s energy sector, long plagued by structural issues that have led to a burden of heavy subsidies on the government.
However,Pakistan’s record in sticking to agreements with the IMF is not encouraging.It has often failed to meet conditions such as curtailing spending and selling government stake in state-owned enterprise.
The International Monetary Fund (IMF) is an international organization headquartered in Washington,US.It consists of 189 countries.It was formed in 1944 at the Bretton Woods Conference.It has been established to (a)foster global monetary cooperation (b)secure financial stability, (c)facilitate international trade (d)promote high employment (e) sustainable economic growth and (f)reduce poverty around the world.
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