The International Monetary Fund (IMF) has stated that Pakistan’s economy is facing a difficult situation, and it is crucial to steadfastly implement the new 9-month Stand-By Arrangement program.
According to media reports, details of the agreement between Pakistan and the IMF reveal that Pakistan will receive $3 billion under the Stand-By Arrangement program. The country is currently grappling with a challenging economic situation, and it will require resources for heavy external financial obligations during the upcoming fiscal year. Pakistan will need to diligently follow the new 9-month program.
According to the international institution, the current fiscal year’s economic growth rate is projected to be 2.5%, while the following year is expected to reach 3.6%. Inflation is anticipated to be 25.9% this year, but it is expected to decrease to 11.4% next year. The estimated rate of debt this year is 70.9%, which is projected to decrease to 68.5% next year. There is a possibility of a negative 1.8% current account deficit this fiscal year, which is expected to be negative 1.7% in the next fiscal year.
IMF forecasts that Pakistan’s foreign exchange reserves will reach $9 billion this fiscal year and are expected to rise to $12.9 billion in the next fiscal year. The government’s efforts to increase the interest rate will be encouraged, while the market-based exchange rate policy will be maintained.
According to the international organization’s report, there is a concern that the fiscal deficit will be Rs. 3.567 trillion this year and may increase to Rs. 5.444 trillion next year. Remittances are expected to remain at $32.88 billion this fiscal year, while they are estimated to increase to $34.76 billion in the next fiscal year. Revenues could reach up to Rs. 3.008 trillion this fiscal year, and it may rise to Rs. 3.334 trillion in the next fiscal year. The defense budget for the current year is Rs. 1.804 trillion, which is expected to increase to Rs. 2.093 trillion in the next fiscal year.
According to the IMF, Pakistan will require external financing of Rs. 8.742 trillion in the next three years. The current fiscal year necessitates external financial cooperation of Rs. 2.836 trillion, while the requirement for the next fiscal year will be Rs. 2.716 trillion. By 2025-26, Pakistan will require financing of Rs. 3.189 trillion.
The IMF estimates tax revenue to reach Rs. 11.21 trillion in the current fiscal year, which could increase to Rs. 13.93 trillion. There is a possibility that tax revenue may reach Rs. 14.738 trillion by the fiscal year 2025-26.
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