Pakistan expects raising $4.5bln this year: Shamshad Akhtar

Islamabad: Caretaker Federal Minister for Finance, Revenue and Economic Affairs, Dr. Shamshad Akhtar said Pakistan anticipates raising approximately $4.5 billion from multilateral and bilateral sources, excluding the International Monetary Fund (IMF) in the current fiscal year (2023-24).

 In an interview with official flagship Journal of ICMA International, the minister said for the second quarter (Q2), the government expects to receive over $1.6 billion from these sources. She said, the major creditors include the Asian Development Bank, the World Bank, and the Asian Infrastructure Investment Bank, adding the inflows comprise both project-based and program-based funds. She said, negotiations for some program loans have been completed, and disbursements are expected.

The country is currently meeting its debt obligations in a timely manner and intends to continue doing so in the future. Talking about IMF programme, the minister said, as the first review of the Standby Agreement was successfully concluded, a Staff Level Agreement (SLA) has been reached.

This is subject to approval by IMF’s Executive Board and upon approval, Pakistan will have access to SDR 525 million (around US$ 700 million).

On existing economic situation, the minister said, despite domestic and global challenges during FY2023, fiscal and external sector stability has been achieved through various stabilization measures and structural reforms.

 Fiscal deficit stood at 7.7% of GDP during FY2023 as compared to 7.9% last year while current account deficit FY2023 narrowed down by 87.2% to $ 2.2 billion against a deficit of $ 17.5 billion in FY 2022. She said, trade deficit was contained by 38.7% in FY2023 as compared to expansion of 36.4% in FY2022.

Ms Akhtar said, the caretaker government took charge in a very tough economic environment, adding turning around the economy was a challenging task and required careful economic planning, policy consistency, and a favourable external economic environment.

“The government is quite vigilant of the challenges/risks emanating from the domestic and external sides and taking timely measures to address them,” she added. The minister said, the government has taken some short-term actions to overcome speculations, smuggling, cartelization, and theft of publicly provided resources.

Encouragingly, the timely actions carried out by relevant government regulatory agencies have begun yielding positive outcomes. Hard earned gains on the fiscal and external accounts have started to translate into a pick-up in economic activity during first four months of FY2024, she added.