Akhtar urges early IMF deal

ISLAMABAD: Pakistan is facing the challenge of unsustainable public debt and the new government should reach an early agreement with the International Monetary Fund (IMF) for a long-term bailout package to continue difficult reforms, said outgoing Finance Minister Dr Shamshad Akhtar on Thursday. In a departing note in the monthly economic outlook, Akhtar said that market confidence had been restored during the past few months and as a result the gross domestic product (GDP) was expected to grow around 3% in the second quarter of the current fiscal year. In the first quarter, the economic growth was 2.1%. “At the heart of economic challenges is the unsustainable public debt position, with Pakistan in breach of the Fiscal Responsibility and Debt Limitation Act (FRDL) since 2013,” said the minister. Although she claimed to have achieved fiscal consolidation, the budget deficit in the first half was 58% higher than the comparative period of last year, which was a reason for debt unsustainability. Akhtar said that it was imperative that the new government completed the last review of IMF programme that would lead to the release of $1.2 billion loan tranche.