Pakistan and IMF team review economic and fiscal policies to unlock much-needed funding

Pakistan and a visiting International Monetary Fund (IMF) mission hold discussions in Islamabad, Pakistan, on January 31, 2023. (Photo courtesy: PID)
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Updated 05 February 2023
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Pakistan and IMF team review economic and fiscal policies to unlock much-needed funding

  • More than $1 billion funding has been delayed since November last year over fiscal consolidation issues
  • Unlocking the funding is key for Pakistan as its forex reserves have dropped to cover just three weeks of imports

KARACHI: Pakistan and a visiting International Monetary Fund (IMF) mission held discussions on Tuesday on the South Asian nation’s economic and fiscal policies and reforms agenda to complete a 9th review of a stalled loan program, the finance ministry said.

The IMF mission headed by Nathan Porter is in Islamabad till February 9, 2023, to continue discussions for the revival of a $7 billion loan program that was signed in 2019. The mission will focus on policies to restore domestic and external sustainability, including to strengthen Pakistan’s fiscal position with durable and high quality measures while supporting Pakistanis affected by last summer’s record-breaking floods.

Talks for the pending ninth review were originally scheduled for October but were delayed mainly due to government’s reluctance to take ‘unpopular decisions’ being pushed by the IMF.

On Tuesday, Federal Minister for Finance Ishaq Dar held a meeting with the IMF review mission led by Porter at the Finance Division.

“The meeting discussed and reviewed the economic and fiscal policies and reforms agenda to accomplish the 9th review under the Extended Fund Facility,” a statement issued by the finance ministry said.

Dar briefed the Mission on fiscal and economic reforms and measures being taken by the government in different sectors, including bridging the fiscal gap and bringing exchange rate stability and reforms in the energy sector:

“He apprised that reforms are being introduced in power sector and a high level committee has been formed for devising modalities to offset the menace of circular debt in gas sector.” 

The finance ministry statement said Porter “expressed his confidence that the government will meet the IMF requirements for the completion of the 9th review.”

Pakistan has already met two key demands of the IMF ahead of the Mission’s Islamabad visit, including adjusting the Pakistani rupee according to market-based demand and supply, and a Rs35 per litter hike in petroleum prices.

“It is good that the talks have started,” Tahir Abbas, head of Research at Arif Habib Limited, said. “It is now likely that the mini-budget would be presented after development consensus on the measures to be taken.” 

Pakistani analysts said the country now had to convince the IMF team to go easy on Rs300 billion tax revenue measures and expected electricity and gas tariffs. 

Pakistan’s highest economic decision making body, the Economic Coordination Committee (ECC) of cabinet, is scheduled to meet today, Tuesday, to discuss issues in the power sector, including a circular debt management plan, fuel charges adjustment, and a waiver of electricity bills in flood affected areas. 

“The ECC is going to take up the matter of tariff rationalization and clearance of accumulation of arrears under the circular debt management plan. This is another step to accommodate IMF demands,” Abbas said. 

As the IMF and authorities resumed talks in Islamabad, Pakistan’s national currency showed some resistance against the United State dollar and closed at Rs267.89 in the interbank market, as compared to Rs269.63 of Monday’s close.

Pakistan’s national currency is under pressure as the country faces fast depleting foreign exchange reserves that have dropped to just $3.7 billion, not even enough to cover import payments for a single month. Pakistan on average has imported goods valued at $5 billion per month during the last six months.

The successful conclusion of talks between authorities and IMF team will lead to the disbursement of $1.1 billion but analysts expect the implementation of key measures under the IMF program will push inflation to over 30 percent in upcoming months. 


Pakistan vows to extend ‘practical support’ to rehabilitate Palestinian educational institutions

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Pakistan vows to extend ‘practical support’ to rehabilitate Palestinian educational institutions

  • At least 625,000 children have been denied entire year of school due to Israel’s war on Gaza, says UNICEF
  • Pakistan and COMSTECH have partnered to provide fully funded scholarships for hundreds of Palestinians

ISLAMABAD: Pakistan’s Education Minister Dr. Khalid Maqbool Siddiqui on Thursday vowed to extend “practical support” to rehabilitate educational institutions in Palestine, the OIC’s Standing Committee on Scientific and Technological Cooperation (COMSTECH) said.

Israel’s military campaigns in Gaza since Oct. 7, 2023, have killed over 44,000 Palestinians. Israel’s bombardment has dealt a heavy setback for education in the area, and according to a report by UNICEF, 625,000 children have been denied an entire school year in Gaza. With the conflict still ongoing, they face the high risk of a second year without education.

COMSTECH, in collaboration with the Association of Private Sector Universities of Pakistan (APSUP), initiated a program in 2021 offering 500 fully funded scholarships and fellowships to Palestinian students. This number was increased to 5,000 scholarships in 2023. Many Palestinian students have already arrived in Pakistan under this program and are pursuing full-degree programs. 

Siddiqui, along with COMSTECH Coordinator General Dr. Muhammad Iqbal Choudhary, visited the Palestinian embassy in Islamabad to discuss matters related to education with Palestinian Ambassador Dr. Zuhair Zaid. 

“He [Siddiqui] assured that Pakistan is committed to extending practical support for the rehabilitation of educational institutions in Palestine,” a press release by COMSTECH said. 

The Pakistani minister reiterated his government and people’s steadfast support for Palestine, COMSTECH said. 

“Sharing insights from his recent visit to Oman, he revealed discussions with educational ministers from other countries about joint actions to assist Palestine in the education sector,” it added. 

Siddiqui said he has proposed convening an extraordinary meeting of the education ministers from OIC member countries in Islamabad to devise a “comprehensive long-term plan for supporting Palestine.”

Zaid expressed thanked the government, COMSTECH and people of Pakistan, the OIC body said. 

“He acknowledged their steadfast support, emphasizing that these efforts will never be forgotten by the Palestinian people,” the statement said.


Pakistan PM visits Azerbaijan embassy, condoles loss of lives in Kazakhstan plane crash

Updated 26 December 2024
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Pakistan PM visits Azerbaijan embassy, condoles loss of lives in Kazakhstan plane crash

  • At least 38 people were killed when Azerbaijan Airlines passenger plane crashed in Kazakhstan’s Aktau city
  • Shehbaz Sharif says ties between Pakistan and Azerbaijan rooted in shared religious and cultural values

ISLAMABAD: Prime Minister Shehbaz Sharif visited Azerbaijan’s embassy in Islamabad on Thursday to condole over the loss of lives in the Azerbaijan Airlines plane crash in Kazakhstan, the Prime Minister’s Office (PMO) said. 
At least 38 people were killed when an Azerbaijan Airlines passenger plane with 67 people on board crashed near the Kazakhstan city of Aktau on Wednesday. The Embraer 190 aircraft was en route from the Azerbaijani capital of Baku to the Russian city of Grozny in the North Caucasus.
The Pakistani prime minister visited the Azerbaijan embassy in Islamabad where he met Khazar Farhadov to offer his condolences over the incident.
“In this hour of grief, the government of Pakistan and the people of Pakistan express their complete solidarity with the brothers and sisters of Azerbaijan,” Sharif was quoted as saying by the PMO.

Pakistan Prime Minister Shehbaz Sharif pens down his remarks at the Embassy of Azerbaijan in Islamabad on December 26, 2024. (Photo courtesy: PMO)

The Pakistani prime minister prayed for the speedy recovery of all injured in the blast.
“Azerbaijan and Pakistan have strong relations of brotherhood based on shared religious and cultural values,” Sharif said.
Pakistan has eyed closer economic cooperation with Central Asian states such as Azerbaijan in recent months as the South Asian nation faces an economic crisis. 
During Azerbaijan President Ilham Aliyev’s two-day visit to Pakistan in July, both nations agreed to enhance the volume of bilateral trade to $2 billion, vowing to strengthen ties and increase cooperation in mutually beneficial economic projects. 
They also signed the Pakistan-Azerbaijan Preferential Trade Agreement to boost economic cooperation through the reduction of tariffs on goods like Pakistani sports equipment, leather, and pharmaceuticals as well as Azerbaijani oil and gas products.


Pakistan reports two new polio cases as 2024 tally surges to 67

Updated 26 December 2024
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Pakistan reports two new polio cases as 2024 tally surges to 67

  • Pakistan detects poliovirus cases from Kashmore in southern Sindh and Tank in Khyber Pakhtunkhwa provinces
  • Efforts to eradicate polio have been undermined by misinformation, opposition from religious hard-liners

KARACHI: Pakistan reported two new polio cases on Thursday, pushing this year’s tally of the infection to 67, the country’s polio eradication program said amid Islamabad’s struggle to contain the spread of the disease. 
Pakistan, along with neighboring Afghanistan, remains the last polio-endemic country in the world. The nation’s polio eradication campaign has faced serious problems with a spike in reported cases this year that have prompted officials to review their approach to stopping the crippling disease.
The Regional Reference Laboratory for Polio Eradication at Pakistan’s National Institute of Health confirmed that two wild poliovirus type 1 cases, one each from Tank in northwestern Pakistan and Kashmore in Sindh were reported on Thursday. 
“Pakistan is responding to the resurgence of WPV1 this year with 67 cases reported so far,” the Polio Eradication Programme said. “Of these, 27 are from Balochistan, 19 from Khyber Pakhtunkhwa, 19 from Sindh, and one each from Punjab and Islamabad.”
It said that this was the fourth case reported from Tank and second from Kashmore this year.
Pakistani authorities last week conducted a large-scale sub-national polio vaccination campaign in Punjab, Sindh, Khyber Pakhtunkhwa, Azad Jammu and Kashmir, Gilgit-Baltistan and Islamabad, vaccinating over 42 million children. 
The second phase of the campaign is scheduled to begin on Dec. 30, covering Balochistan province. 
Poliovirus, which can cause crippling paralysis particularly in young children, is incurable and remains a threat to human health as long as it has not been eradicated. Immunization campaigns have succeeded in most countries and have come close in Pakistan, but persistent problems remain.
In the early 1990s, Pakistan reported around 20,000 cases annually but in 2018 the number dropped to eight cases. Six cases were reported in 2023 and only one in 2021.
Pakistan’s polio program began in 1994 but efforts to eradicate the virus have since been undermined by vaccine misinformation and opposition from some religious hard-liners, who say immunization is a foreign ploy to sterilize Muslim children or a cover for Western spies. Militant groups also frequently attack and kill members of polio vaccine teams.


UN calls for investigation into Pakistan’s alleged air strikes on Afghanistan border

Updated 26 December 2024
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UN calls for investigation into Pakistan’s alleged air strikes on Afghanistan border

  • UN mission in Afghanistan says dozens of civilians killed in airstrikes this week by Pakistan in Paktika province
  • Islamabad accuses Kabul of harboring militant fighters, allowing them to strike on Pakistani soil with impunity

KABUL: The UN mission to Afghanistan on Thursday called for an investigation into Pakistani air strikes in Afghanistan, in which the Taliban government said 46 people were killed, including civilians.
The United Nations Assistance Mission in Afghanistan (UNAMA) said it had “received credible reports that dozens of civilians, including women and children, were killed in airstrikes by Pakistan’s military forces in Paktika province, Afghanistan, on 24 December.”
“International law obliges military forces to take necessary precautions to prevent civilian harm,” the agency said in a statement, adding an “investigation is needed to ensure accountability.”
The Taliban government said the 46 deceased were mainly women and children, with another six wounded, mostly children.
An AFP journalist saw several wounded children in a hospital in the provincial capital Sharan, including one receiving an IV and another with a bandaged head.
A Pakistan security official told AFP on Wednesday the bombardment had targeted “terrorist hideouts” and killed at least 20 militants, saying claims that “civilians are being harmed are baseless and misleading.”
On a press trip to the area organized by Taliban authorities, AFP journalists saw four mud brick buildings reduced to rubble in three sites around 20-30 kilometers (10-20 miles) from the Pakistan border.
AFP spoke to multiple residents who said the strikes hit in the late evening, breaking doors and windows in villages and destroying homes and an Islamic school.
Several residents reported pulling bodies from the rubble after strikes targeted houses, killing multiple members of the same families.
Afghanistan’s Minister of Borders and Tribal Affairs Noorullah Noori called the attack “a brutal, arrogant invasion.”
“This is unacceptable and won’t be left unanswered,” he said during the site visit.
Pakistani foreign ministry spokesperson Mumtaz Zahra Baloch did not confirm the strikes but told a media briefing on Thursday: “Our security personnel conduct operations in border areas to protect Pakistani from terror groups, including TTP.”
She was referring to the Tehreek-e-Taliban Pakistan (TTP) — Pakistan’s homegrown Taliban group which shares a common ideology with its Afghan counterpart.
The TTP last week claimed a raid on an army outpost near the border with Afghanistan in which Pakistan said 16 soldiers were killed.
Baloch said Pakistan prioritized dialogue with Afghanistan, and that Islamabad’s special envoy, Sadiq Khan, was in Kabul meeting with officials where “matters of security” and “terror groups including TTP” were discussed.
The strikes were the latest spike in hostilities on the frontier between Afghanistan and Pakistan, with border tensions between the two countries escalating since the Taliban government seized power in 2021.
Islamabad has accused Kabul’s authorities of harboring militant fighters, allowing them to strike on Pakistani soil with impunity — allegations Kabul denies.


Army major, 13 militants killed during separate operations in northwestern Pakistan — military

Updated 26 December 2024
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Army major, 13 militants killed during separate operations in northwestern Pakistan — military

  • Major Muhammad Awais, 31, killed while battling militants in South Waziristan district, says military
  • Sixteen soldiers were killed on Saturday in northwest Pakistan as Islamabad grapples with militancy

ISLAMABAD: An army major and 13 militants were killed during three separate intelligence-based operations in northwestern Pakistan, the military’s media wing said on Thursday, vowing to eliminate militancy from the country.
Pakistan’s Khyber Pakhtunkhwa province, which lies on the country’s border with Afghanistan, has witnessed frequent attacks by the Pakistani Taliban, or the Tehreek-e-Taliban Pakistan (TTP) and other militant groups that targeted security forces convoys and check posts in recent months.
The latest killings were reported after three separate gunbattles between militants and Pakistani security forces from Dec. 25-26, the Inter-Services Public Relations (ISPR) said. Two militants were killed in Bannu district while five others were killed in the North Waziristan district in a separate operation.
“However, during this operation, Major Muhammad Awais (age: 31 years, resident of District Narowal), a brave officer, who was leading his troops from the front, having fought gallantly, paid the ultimate sacrifice and embraced Shahadat [martyrdom],” the ISPR said.
In the third operation in South Waziristan district, six militants were gunned down by the security forces while eight others were injured.
“Security forces of Pakistan are determined to wipe out the menace of terrorism and such sacrifices of our brave soldiers further strengthens our resolve,” the military said.
Prime Minister Shehbaz Sharif paid tribute to Pakistan’s security forces for battling militants and offered condolences for Major Awais’s killing.
“The entire nation salutes martyred Major Owais,” he said in a statement. “We remain resolute in our desire to eliminate all forms of terrorism.”
Pakistan has struggled to contain militancy in its northwestern KP province. Sixteen Pakistani soldiers and eight militants were killed in a gunfight on Saturday in South Waziristan, the military reported.
The attack was claimed by the Pakistani Taliban. 
Islamabad has frequently accused neighboring Afghanistan of sheltering and supporting militant groups that launch cross-border attacks. Afghan officials deny involvement, insisting Pakistan’s security issues are an internal matter of Islamabad.