By Staff Reporter
ISLAMABAD: Finance Minister Ishaq Dar said on Thursday the country was very close to signing a staff level agreement with the International Monetary Fund though Islamabad is still resolving differences with Fund to resume its $6.5 billion loan program.
An agreement would release $1.1 billion tranche.
“We seem to be very close to signing the staff level agreement, hopefully, God willing, in the next few days,” Dar said at a seminar in Islamabad. “I and my team are absolutely committed to complete this program to the best of our ability. We have been in the review and I think it has taken longer than it should have in my opinion.”
Minister Dar said the current crisis was deeper and more complex than the two prior experiences he had overseen as finance minister, but he was confident the economy would be pulled out of the “quagmire”.
He said reforms in the energy sector, which has piled up more than four trillion rupees ($14.18 billion) in debt, were the most critical to get the economy back on track.
“The power sector has to be structurally reformed and fixed and let me endorse that the issue was and has been very grave,” he said.
The minister said he was unaware of the country’s economic woes before taking charge as the finance minister. Dar took over from fellow party member Dr Miftah Ismail as finance chief at the end of September last year.
“We are striving hard to revive the economy. Frankly speaking, before I took over the office, from a distance I didn’t know how deep a quagmire we, as a country, were in,” he said.
“I have very firm faith that we would come out of this quagmire. It is deeper than before and I would say much more complex than the previous two experiences I had as finance minister,” he added.
Pakistan is facing its worst economic crisis in decades with dollar reserves falling to $4.3 billion, enough for just one month of imports.
The low levels have raised a red flag as the country looks for additional multibillion-dollar financial support packages from friendly countries to shore them up. The country is in dire need of funds to cover its current account deficit and debt obligations, for which it needs more than $11 billion in external financing in the remaining months of this financial year.
Pakistanis are experiencing inflation at levels not seen for decades as prices surge for essentials like food, energy, transport, and accommodation.
Pakistan’s ninth review of staff-level talks with the IMF for the release of its next tranche is delayed of almost seven months on differences on several issues.
The global lender has set strict conditions before resuming the bailout programme , such as asking the government to allow a market-determined exchange rate for the local currency, ease fuel subsidies, and control circular debt in the power sector.
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