IMF disburses USD 1.023 bn tranche to Pak; to hold virtual discussions about budget

The International Monetary Fund has disbursed a second tranche of USD 1.023 billion under the Extended Fund Facility programme for Pakistan, the central bank said on Wednesday.
The disbursement of the second tranche comes on a day when the International Monetary Fund (IMF) is holding virtual discussions on Pakistan's upcoming budget as the visit of its mission to Islamabad was delayed due to security concerns in the region.
The federal government is planning to unveil the budget for fiscal 2025-26 on June 2.
The IMF talks will continue until May 16.
The Central bank said the second tranche amount would be reflected in its foreign exchange reserves for the week ending May 16.
The amount was approved last week by the IMF board under the ongoing Extended Fund Facility (EFF) and allowed an additional arrangement for the USD 1.4 billion Resilience and Sustainability Facility (RSF).
The decision to release the funds came after the IMF expressed satisfaction on the first review of Pakistan's economic reform programme supported by the EFF Arrangement, the bank said.
The IMF noted that Pakistan's policy efforts under the EFF had already delivered 'significant progress' in stabilising the economy and rebuilding confidence, amidst a challenging global environment.
'Fiscal performance has been strong, with a primary surplus of two per cent of gross domestic product achieved in the first half of FY25, keeping Pakistan on track to meet the end-FY25 target of 2.1 per cent of GDP.
Pakistan's gross reserves stood at USD 10.3 billion at end-April, up from USD 9.4 billion in August 2024, and are projected to reach USD 13.9 billion by end-June 2025 and continue to be rebuilt over the medium term, it was pointed out.
Meanwhile, the IMF talks that started virtually Wednesday will continue until May 16.
The global lender has appointed a new mission chief to Pakistan and the mission is now expected to travel to Islamabad over the weekend, subject to the security situation, government sources told The Express Tribune on Tuesday.
The IMF mission delayed its scheduled arrival here on Tuesday due to uncertainty caused by the India-Pakistan conflict that had affected air travel across the region.
'Virtual discussions are expected to be held from today. For the second and final leg of the talks, the IMF team is expected to arrive in Islamabad on Saturday and stay until May 23,' the source said.
The IMF's Resident Representative to Pakistan Mahir Binici did not respond to a request for comment on the change in the travel plan.
Finance Ministry spokesperson Qumar Abbasi also did not respond to questions on the change in the travel plans.
Meanwhile, the IMF appointed Iva Petrova, a Bulgarian origin staff member, as new Mission Chief to Pakistan. She would join the discussions along with the outgoing Mission Chief Nathan Porter — who served in the position for an extended term.
Binici also did not comment on whether both outgoing and new mission chiefs would join both rounds of talks.
Petrova, who holds a PhD degree in economics from the Michigan State University, has been serving as the IMF Mission Chief to Armenia. Previously, she had served with the missions to Israel, Iceland and Latvia.
In Pakistan, the fiscal policy is expected to remain tight in the next fiscal year too. The IMF has asked Pakistan to make a budget on the assumption of having 1.6 per cent of the GDP primary budget surplus, which will require generating about Rs 2 trillion over and above the non-interest expenses.
The tax target for the Federal Board of Revenue (FBR) is proposed to be 11 per cent of the GDP or Rs 14.3 trillion. The IMF would examine whether the government plans to take credibly realistic measures to back the new tax target, said the sources.
The IMF has set multiple fiscal conditions, whose successful completion has so far helped smooth continuation of the programme despite initial setbacks.
Pakistan has met the IMF targets for a primary budget surplus by the federal government, as well as net revenue collection and cash surplus targets by the four provinces.
Against a primary surplus target of Rs 2.7 trillion, the federal government reported a surplus of Rs 3.5 trillion, or 2.8 per cent of GDP.
The size of the federal budget still remains tentative due to redoing of defence needs and the government plans to announce less than Rs 18 trillion budget. The overall budget deficit target after incorporating large provincial cash surpluses is projected at 5.1 per cent of the GDP or Rs 6.7 trillion, the sources said.

Try Our AI Features

Explore what Daily8 AI can do for you:

Learn with AIFact CheckingText to SpeechAI Summary

Related Articles

New Indian Express

6 hours ago

• New Indian Express

Odisha Vision 2036-2047 focuses on economic hubs, industrial push, infrastructure, women-led growth

BHUBANESWAR: Odisha on Thursday laid out a bold and time-bound strategy to become a developed state by 2036 and a USD 1.5 trillion economy by 2047. Released by Prime Minister Narendra Modi, the Vision-2036 blueprint, part of the broader 'Viksit Odisha for Viksit Bharat' agenda, sets ambitious targets to rapidly urbanise, double employment, and attract massive investments to the state. The vision focuses on six foundational pillars: people first, rural empowerment, people-centric governance, prosperity for all, our legacy our pride, and technology leading the way. These encompass priority areas such as women-led development, quality education, universal healthcare, green energy, smart agriculture, and cultural revitalisation. The state has set a target for the creation of over one crore new jobs, backed by massive investments in manufacturing, green energy, agriculture, skilling, and tourism. A core part of this plan is the creation of world-class economic agglomerations. It envisages a Bhubaneswar-Cuttack-Puri-Paradip Economic Region (BCPPER), which will be developed into a USD 500 billion hub, contributing to one-third of the state's GSDP by 2047.

The Print

10 hours ago

• The Print

Rupee recovers from two-month low level; settles 18 paise higher at 86.55 against US dollar

At the interbank foreign exchange, the domestic currency opened at 86.65 and traded in a narrow range of 86.55-86.67, before ending the session at its intra-day peak of 86.55 against the US dollar, registering a gain of 18 paise from previous closing level. A robust sentiment in domestic equity markets further supported the local unit, according to forex traders. Mumbai, Jun 20 (PTI) The rupee snapped its three-day losing streak and settled with a gain of 18 paise at 86.55 against the US dollar on Friday, buoyed by a massive inflow of foreign capital, retreating crude oil prices and a weakening greenback. The rupee had lost 30 paise to close at an over two-month low of 86.73 against the dollar on Thursday, logging a combined loss of 69 paise in the past three sessions. According to Maneesh Sharma, AVP – Commodities & Currencies, Anand Rathi Shares and Stock Brokers, the rupee gained on Friday but declined a little over 1 per cent this month so far, 'with a large portion of its decline occurring after Israel attacked targets in Iran last Friday'. Dilip Parmar, Research Analyst, HDFC Securities, attributed the rupee's resurgence to 'a revitalisation in the domestic stock markets and a subdued greenback, which receded following reports of President Donald Trump postponing a decision regarding an Iran strike'. Additionally, Parmar said, lower imported commodity prices lent additional buoyancy to the local rupee. 'In the near-term, the spot USD/INR pair faces resistance at 87.10 and finds support at 86.45. The overall bias for the USD/INR pair remains favourable,' he added. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.30 per cent lower at 98.60. In the domestic equity market, the 30-share BSE Sensex surged 1,046.30 points to settle at 82,408.17, while Nifty soared 319.15 points to 25,112.40. Brent crude, the global oil benchmark, declined 2.36 per cent to USD 76.99 per barrel in futures trade. Foreign institutional investors (FIIs) purchased equities worth Rs 7,940.70 crore on a net basis on Friday, according to exchange data. The latest weekly data released by the Reserve Bank of India on Friday showed India's forex reserves rose USD 2.294 billion to USD 698.95 billion during the week ended June 13. However, government data showed the country's eight core sectors' growth slowed down to 0.7 per cent, lowest in nine months, in May 2025 against 6.9 per cent in the same month last year. In April, the growth in output of these key infrastructure sectors were recorded at 1 per cent. PTI TRB HVA This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.

India Gazette

12 hours ago

• India Gazette

"Outdated, misinformed, and disconnected from reality," Amit Malviya slams Rahul Gandhi's claims on Make in India

New Delhi [India], June 21 (ANI): BJP leader Amit Malviya on Saturday hit back at Congress leader Rahul Gandhi's criticism of the 'Make in India' initiative, and said that India's manufacturing sector is growing strongly under Prime Minister Narendra Modi. Amit Malviya said India is now the world's second-largest mobile phone maker, growing from just 2 factories in 2014 to over 300 today. He added that the PLI scheme brought in Rs 10,905 crore in investments, with total production of Rs 7.15 lakh crore and exports of Rs 3.9 lakh crore, proving Rahul Gandhi's claims wrong. In a post on X, Amit Malviya wrote, 'Rahul Gandhi claims that manufacturing is collapsing under Modi's 'Make in India'. Let's bust the myths with facts. India is now the world's 2nd largest mobile phone producer. From just 2 mobile manufacturing units in 2014 to over 300 today. The so-called 'failed' PLI scheme, as labelled by Rahul Gandhi, has led to: Cumulative investments of 10,905 crore, Total production worth 7.15 lakh crore, Exports of 3.9 lakh crore, Electronics production value rose from 18,900 crore (FY14) to 4,22,000 crore (FY24).' 'Mobile phone exports surged 77-fold from 1,566 crore (2014-15) to 1.2 lakh crore (2023-24), 99.2% of mobile phones sold in India are now made in India, up from just 26% in 2014-15. Under the PLI scheme for electronics alone, 1,39,670 direct jobs have already been created. 1.8 lakh new companies were registered in 2023-24, marking a 16% increase over the previous year. Electronics exports hit USD 38+ billion in FY24-25, a 32% year-on-year increase. PLI allocations for electronics rose from 5,747 crore (FY24-25) to 8,885 crore (FY25-26) a clear signal of continued commitment,' the post reads. Malviya said that under PM Modi, India has transformed from an importer to a global manufacturing powerhouse. He said the government has approved major semiconductor projects worth Rs 1.52 lakh crore and that electronics production is expected to reach USD 300 billion by 2026. He dismissed Rahul Gandhi's criticism as outdated and said India is growing, building, and leading in the tech and manufacturing sectors. 'The government has approved landmark semiconductor projects worth 1.52 lakh crore, a critical leap into deep-tech manufacturing. Overall, electronics production is projected to reach USD 300 billion by 2026. Under PM Modi, India has transformed from an importer to a global manufacturing powerhouse. Rahul Gandhi's narratives are outdated, misinformed, and disconnected from reality. India is building. India is growing. India is leading,' the post further reads. Earlier in the day, the Leader of Opposition in Lok Sabha and Congress MP Rahul Gandhi criticized Prime Minister Narendra Modi saying that despite promises of a 'Make in India' factory boom, manufacturing in the country is at a record low and youth unemployment is very high. Gandhi questioned the effectiveness of the 'Make in India' initiative, highlighting that manufacturing in the country has fallen to a record low of 14 per cent of the economy since 2014. (ANI)