Despite depressive economic situation of the country, the aid-dependent Pakistan on Friday re-paid the fourth installment of $397.2 million to the International Monetary Fund (IMF),a State Bank official said.
The official said with the paying off forth installment, Pakistan paid back the total amount of $1.29 billion of loan to the International Monetary Fund so far from foreign currency reserves held by the State Bank of Pakistan (SBP).
The official was of the view that the recently received amount of $1.18 billion in Coalition Support Fund (CSF) from the US had given some space to the country’s economic trouble shooter to repay installments to the IMF on monthly bases.
The official said from recently ended financial year 2011-12 to end fiscal year 2014-15, Pakistan was expected to face a 3-5 percent increase in value of IMF loans repayment because of Pakistani rupee constant depression in the recent days and fear in the future as well.
The official said the country’s foreign exchange reserves will continue to face pressure due to re-payment of IMF loans in the next more than three years as Pakistan is likely to go to the International Monetary Fund in fresh loan in current fiscal year 2012-13 to seek loan for the retirement of IMF’s Stand-by Arrangement (SBA) facility.
Analysts, however, remained cautious, especially for current fiscal year, saying the government may have to negotiate another loan programme with the Fund to ensure smooth repayment of the remaining installments to the IMF. The government had repaid $1.2 billion to IMF in last financial year 2011-12, out of the total loan of around $7.6 billion. Pakistan has to pay around $2.9 billion during on going financial year 2012-13, $3.43 billion in 2013-14 and $1.35 billion in 2014-15 to retire IMF outstanding loans. The $11.3 billion SBA program had expired on September 30, 2011 and the last two trenches of $3.7 billion could not pay to Pakistan by IMF following Islamabad’s failure to pursue key reforms as well as the emergence of the revenue figures fiasco. Pakistan had enter into a $11.3 billion programme in 2008 with IMF and got disbursements of about $7.6 billion, but failed to get the remaining $3.7 billion due to slippages in performance criteria, leading to suspension of the programme in May 2010 and was ended unsuccessfully on September 30,2011.
IMF Penalty on Pakistan?
Government must also clarify how much penalty was imposed by IMF on Pakistan over its failure to utilize $3.7 billion, out of the sanctioned total loan amount of $11.3 billion; when the IMF Programme was terminated, due to the slippages in performance criteria, after receiving $7.6 billion from IMF?
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