IMF team due on July 15

Pakistan and the IIMF will hold a series of talks from July 15 for release of the sixth loan tranche of $1.2 billion.

Pakistan and the International Monetary Fund (IMF) will hold a series of talks from July 15 for release of the sixth loan tranche of $1.2 billion.

An IMF mission, led by Director for Middle East and Central Asia Adnan Mazari, which will arrive for the talks on July 15, will be briefed about the economic condition of the country in fiscal year 2010, officials said.

The mission will meet different ministries and discuss various issues including the imposition of a reformed General Sales Tax (GST) in place of Value Added Tax (VAT). They will also review whether the conditions set by the IMF were fulfilled by Pakistan or not.

Officials revealed that most of the conditions have been met and the draft of reformed GST is in final stages.  Actual budget deficit stood at 5.7 per cent but it will likely be reduced to 5.5 per cent after finalisation of statistics, officials said.

Had the $1.2 billion loan tranche been transferred before June 30, the budget deficit would have been at a much lower level, the officials said. Another reason for the increase in the deficit was the suspension of an $850 million loan by the World Bank and Asian Development Bank.

Published in The Express Tribune, July 9^th, 2010.