Islamabad, December 2, 2024 – The government has initiated stringent measures targeting civil servants as part of efforts to secure the second tranche of $1.1 billion under the International Monetary Fund (IMF) program.
According to official details, the disbursement is contingent on meeting 39 tough conditions, including mandatory declaration of assets by civil servants and their families. The conditions also bar tax amnesties, restrict additional budgetary grants, and require the publication of governance and corruption assessment reports.
Key requirements include maintaining foreign exchange reserves equivalent to three months’ import bills, achieving public finance targets, implementing rightsizing measures, and hitting revenue collection goals. The IMF has insisted on strict adherence to the benchmarks outlined in the agreement, as confirmed by Finance Minister Muhammad Aurangzeb.
Key Conditions:
- Civil servants must declare assets by February 2025.
- No additional budget grants or tax amnesties.
- Foreign exchange reserves to reach $8.65 billion by June 2025.
- Exchange rate fluctuation between open market and interbank rates must remain under 1.25% during business days.
- Total government guarantees limited to PKR 5.6 trillion, while BISP spending capped at PKR 599 billion.
- FBR to meet a revenue target of PKR 12.913 trillion this fiscal year, including PKR 50 billion from traders.
Additional measures include restrictions on state borrowing from the central bank, capping power sector arrears at PKR 417 billion, and limiting tax refunds to PKR 24 billion.
During a National Assembly finance committee meeting, Finance Minister Aurangzeb outlined the progress in achieving macroeconomic stability over the past 14 months. He emphasized the need to reduce middlemen’s role in curbing inflation and unveiled strategies to address food price volatility.
The minister also highlighted structural reforms in taxation and energy sectors, linking them to population control measures. Addressing climate change and social issues such as child stunting and out-of-school children, he stressed the importance of long-term planning.
Aurangzeb confirmed that Pakistan and the World Bank are set to sign a ten-year Country Partnership Framework, signaling optimism about the economy’s recovery, as reflected in improved stock market performance.
