Accord on $ 6Bn IMF package likely by April

Pakistan is expected to complete its talks with the IMF for up to $ 6Bn bailout package very soon to make it part of the FY20 budget. The technical staff-level contact through video-link is due this week and may be followed up by Finance Minister Asad Umar next week. A lot of work still needs to be done, but a final agreement should be in place by Apr’ 19 and implementation might start rolling in Jun’ 19. Revenue collection target for FY20 will be worked out by the IMF and it could be well above PKR 4.7Tn, compared to about PKR 4.39Tn in FY19 fixed by the govt. The IMF is also not satisfied with the previous increase in electricity and gas prices and is seeking further upward adjustments in tariffs. It has demanded a complete and meaningful free float exchange rate regime, which the govt. is not ready to concede.