ISLAMABAD: Pakistan and the IMF’s review talks have so far remained inconclusive after breaches committed by Islamabad on different fronts which the Fund staff termed as ‘deviations’ from the IMF agreed.

The IMF staff also raised serious objections over the Prime Minister’s Relief Package for slashing down petrol, diesel, and electricity prices as well as granting tax amnesty for the industrial sector.

The IMF had slapped the condition that Pakistan will not grant any tax amnesty and it is part of a continuous structural benchmark. However, Islamabad breached this continuous structural benchmark which now requires a waiver from the IMF’s Executive Board for completion of the 7th review and release of the next tranche.

For striking consensus on Memorandum of Financial and Economic Policies (MEFP), the IMF has asked Islamabad to jack up discount rate, allow free movement of the exchange rate, slash down Kamyab Pakistan Program (KPP) and reverse relief package measures to align it with prudent financial management. The review talks were scheduled for two weeks and are expected to conclude on coming Wednesday.

With emerging of new realities on the macroeconomic front, the IMF has opposed the PM’s Relief Package under which the petrol and diesel prices were reduced by Rs 10 per liter and electricity prices by Rs 5 per unit from March to June 2022.

The government has envisaged disbursing loans of Rs 407 billion under much hyped KPP but the IMF is asking to slash down this amount for two years period till June 2023.