Pakistan and the International Monetary Fund (IMF) will hold negotiations on November 2 for the next tranche of the $3 billion Stand-By Arrangement, worth $710 million.
The negotiations are expected to be difficult, as the Pakistan faces a number of challenges, including a shortfall in external financing, a declining rupee, and a need to reduce oil subsidies.
However, it looks like Pak Army is hopeful of the success of the negotiations, and is taking steps to strengthen its position. For example, the Army is expected to announce general elections soon, which would help to improve investor confidence. It is also working to reduce power division circular debt, which is a condition of the IMF program.
The outcome of the negotiations will have a significant impact on the Pakistani economy. If the negotiations are successful, the Paki ‘establishment’ will be able to access the next tranche of IMF funding, which will help to stabilize the economy. However, if the negotiations are unsuccessful, Pakistan will face further challenges in its efforts to meet its economic goals.
Analysts’ Views
Analysts say that the negotiations are crucial for Pakistan, as the country is in desperate need of foreign financing to avoid a default on its foreign debt obligations. However, they also warn that they will have to make tough concessions in order to reach an agreement with the IMF.
One analyst told Express Tribune that the Paki establishment will need to “commit to a credible fiscal consolidation plan” and “raise taxes significantly” in order to meet the IMF’s demands. Another analyst warned that they will also need to “end oil subsidies and raise electricity prices” in order to reduce its budget deficit.
The Pakistan-IMF negotiations will be a major test for the Pak Army’s ability to manage the country’s economy. If the negotiations are successful, they will be able to avoid a default and stabilize the economy. However, if the negotiations are unsuccessful, the country could face a serious economic crisis.