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PAKISTAN’S ECONOMIC FUTURE HANGS IN THE BALANCE AS IMF DECISION LOOMS Wednesday, 28 June, 2023 I 9 Zil Hajj, 1444
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Rs 15.00 | Vol XIII No 359 I 8 Pages I Islamabad Edition
PM SHEHBAZ HOPES OF FINAL DECISION ON STALLED LOAN IN A DAY OR TWO PROFIT
STAFF REPORT
N a crucial development on Tuesday, Prime Minister Shehbaz Sharif recently engaged with International Monetary Fund (IMF) Managing Director Kristalina Georgieva via phone call, expressing hope for an imminent decision on the release of bailout funds. As the country’s economy faces severe challenges, this awaited decision carries significant implications for the nation’s financial stability. The PM’s Office released a statement that the IMF chief and the prime minister discussed matters related to the stalled bailout programme. According to the statement, the premier has expressed hope that coordination on the points of the bailout programme would lead to a decision from the Washingtonbased lender in a day or two. “The prime minister also reiterated his determination to achieve the goals of improving the economic situation through joint efforts,” the statement added. With the ninth review under the 2019 Extended Fund Facility (EFF) still pending and the program set to expire on June 30, time is running out to secure the much-needed $1.2 billion tranche from the IMF. The prime minister’s back-to-back meetings with Georgieva in Paris last week reflect the urgency of the situation. The IMF had raised concerns about Pakistan’s budget for the upcoming fiscal year, stating that certain proposed measures contradicted the conditional-
ity of the EFF program. In response, the government took proactive steps to address these concerns and ensure align-
ment with the IMF’s requirements. Changes to the budget were implemented, including additional tax meas-
ures, spending cuts, and the lifting of import restrictions, in a last-ditch effort to secure the critical funding. During the phone call, the IMF chief acknowledged the efforts of Finance Minister Ishaq Dar and his team in completing the pending bailout program. Furthermore, the IMF expressed its desire to witness improvements in Pakistan’s economy and appreciated the Prime Minister’s unwavering commitment to this cause. Pakistan’s economic future hangs in the balance as the awaited decision from the IMF draws near. The country’s economy is in the midst of a severe crisis, with record levels of inflation and interest rates. Securing the IMF loan is paramount to avoid defaulting on foreign debt obligations and to stabilise the financial landscape.
IMF continues discussions with Pakistani authorities for quickly reaching an agreement ISLAMABAD
STAFF REPORT
The International Monetary Fund (IMF) continues discussions with Pakistani authorities with the aim of quickly reaching an agreement on financial support from the Fund. The IMF Mission Chief to Pakistan Nathan Porter in a statement said that over the past few days, the Pakistani authorities have taken decisive measures to bring policies more in line with the economic reform program
PML-N, PPP fail to resolve differences in Dubai meeting ISLAMABAD
STAFF REPORT
The People’s Party and the PML-N in their Dubai meeting failed to resolve most of the issues. The leaders of the two parties are likely to sit again today to resolve differences. The PML-N and the PPP have agreed to resolve the issues between them with dialogue. PML-N top leader Nawaz Sharif and PPP leaders Asif Ali Zardari and Bilawal Bhutto have been in Dubai for talks over the election and other political issues. People’s Party sources have said that the issue of seat adjustment was not discussed with the PML-N leadership. “Former president Asif Ali Zardari discussed the charter of economy with PML-N leaders,” sources said. The two sides also discussed the caretaker setup and future line of action in the meeting yesterday. The PPP leaders also clarified the party’s stance over general election adding that they want election in October or November, according to sources. The coalition partners in the PDM government also discussed on pre-date dissolution of the assemblies. The two sides have been at odds with regard to the timetable of the next general election after dissolution of assemblies in August. Asif Ali Zardari and Bilawal Bhutto Zardari have been staying in Dubai for further talks with Nawaz Sharif and other PML-N leaders.
supported by the IMF. The measures included the passage of a budget by the parliament that broadens the tax base while opening up space for higher social and development spending, as well as steps towards improving the functioning of the foreign exchange market and tightening monetary policy to reduce inflationary and balance of payment pressures that affect the more vulnerable. “The IMF team continues discussions with Pakistani authorities with the aim of quickly reaching an agreement on financial sup-
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port from the IMF,” read the statement made by the IMF Mission Chief. Meanwhile, Finance Minister Ishaq Dar Tuesday said that the government is trying to find a mechanism to get the full pending finances of $2.6 billion under the loan programme of the International Monetary Fund (IMF). The finance minister in a private tv show expressed hope that an agreement would be reached with the global lender for the release of the muchneeded $1.1 billion tranche.
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US recognises Pakistan’s efforts in fighting terror following critical statement ISLAMABAD
STAFF REPORT
In response to a “one-sided” joint statement critical of Pakistan issued by the United States and India after President Joe Biden’s meeting with Prime Minister Narendra Modi, the State Department on Monday recognised Islamabad’s measures to combat terrorism. The Foreign Office summoned the US embassy’s deputy chief of mission to express concern over the statement last week that called on Pakistan to ensure its territory was not used as a base for attacks. The statement was released after a meeting between the two leaders on Friday and had received criticism from Pakistan, which called it contrary to diplomatic norms. During a press conference on Monday, a State Department spokesperson, Matthew Miller, emphasized that the United States acknowledges Pakistan’s significant steps in countering terrorist groups, in alignment with the completion of its Financial Action Task Force (FATF) plans. Miller said: “…we remain committed to working with Pakistan to address the shared threat posed by terrorist groups throughout the region.”
Highlighting the suffering endured by the nation of Pakistan due to attacks over the years, Miller underscored the importance of Pakistan’s continuous efforts to “permanently dismantle all terrorist” organisations. “At the same time, however, we have also been consistent on the importance of Pakistan continuing to take steps to permanently dismantle all terrorist groups, including Lashkar-i-Taiba (LeT) and Jaish-e-Mohammad, and their various front organizations and we will raise the issue regularly with Pakistani officials,” he said. He further expressed the US government’s intention to regu-
larly raise this issue with Pakistan and maintain collaboration in countering mutual terrorist threats. Relations between Pakistan and India have been fraught for years. Since independence from Britain in 1947, they have fought three wars, two of them over the Muslim-majority Himalayan region of Kashmir, which they both claim in full but rule in part. The army claimed on Saturday that two civilians were killed by Indian forces in firing across the Line of Control (LoC), the de facto border in Kashmir, the first such conflict since a ceasefire in 2021 between the two nucleararmed neighbours.
ECNEC approves key flood protection projects worth billions of rupees PROFIT
GHULAM ABBAS
The Executive Committee of the National Economic Council (ECNEC) met under the leadership of Senator Mohammad Ishaq Dar, the Federal Minister for Finance and Revenue, to approve several crucial flood protection projects. These initiatives, aimed at bolstering flood management and safeguarding infrastructure, received substantial allocations from the national budget. As per details shared by Ministry of Finance, one of the significant projects approved by the ECNEC is the “Umbrella PC-I of the Flood Protection Sector Project-III (FPSP-II),” presented by the Ministry of Water Resources. This comprehensive project, allocated a whopping Rs. 19,462.5 crores, is set to be implemented across all provinces, including Gilgit-Baltistan and Azad Jammu and Kashmir. The project aims to revolutionize flood management strategies through innovative structural and nonstructural interventions. With a foreign exchange component of Rs1,086 crore, the government’s commitment to safeguarding vulnerable areas from the devastating impact of floods is evident. In response to the water supply needs of the Thar Coal region, the ECNEC also approved the “Makhi Farash Link Canal Project (Chotiari Phase-II)” presented by the Irrigation Department of the Sindh government. With an increased budget of Rs1,208 crore, the project aims to facilitate the transportation of 200 cusecs of canal water, supporting electricity generation and promoting agro-industrial growth. The initiative is expected to expedite socio-economic development in the Sanghar and Umerkot districts. Recognizing the urgency of restoring flood-damaged infrastructure, the committee approved the “Kachhi Canal Project Restoration of Flood Damages 2022,” proposed by the Ministry of Water Resources. The allocated budget of Rs828 crore will be utilised by the Water and Power Development Authority (WAPDA) to execute the project in the Punjab districts of Dera Ghazi Khan, Muzaffargarh, and Rajanpur. The project aims to address water scarcity issues and protect critical infrastructure from future flood damage. The approval of these flood protection projects underscores the government’s commitment to enhancing the nation’s disaster resilience and ensuring the safety of its citizens. The allocated funds will play a pivotal role in implementing comprehensive flood management strategies, constructing protective infrastructure, and fostering sustainable development in flood-prone areas. Apart from these crucial decisions, the Economic Coordination Committee (ECC) met concurrently and made several noteworthy approvals. Notably, a technical supplementary grant of Rs. 20 crore was approved for the Department of the Auditor General of Pakistan (DAGP). This grant will support employee-related expenses, ensuring the smooth functioning of the department. Additionally, the ECC reviewed and approved a summary presented by the Ministry of Interior, granting a technical supplementary grant of Rs. 381.3 crore. Out of this amount, Rs. 298.937 crore will be allocated to the Frontier Corps Khyber Pakhtunkhwa (North), and Rs. 82.458 crore will be allocated to the Frontier Corps Khyber Pakhtunkhwa (South). These funds will cover ration bills for the security forces stationed in the region, strengthening their operational capabilities. Furthermore, the ECC discussed and approved a summary presented by the Petroleum Division, focusing on policy guidelines for import on foreign supplier’s accounts through customs bonded storage facilities. These guidelines are expected to streamline the import process and improve the management of petroleum imports, ensuring stability in the energy sector.
No civilian trials in military courts as of now, government tells Supreme Court ISLAMABAD
STAFF REPORT
The government, during the fourth hearing of a set of petitions challenging the trial of civilian protestors in military courts, said on Tuesday that army tribunals were not conducting trials at the present moment. During the previous day’s hearing, Chief Justice Umar Ata Bandial had requested reassurance from Attorney General for Pakistan (AGP) Mansoor Usman Awan that no such trials would take place while the case was being heard in court. The AGP affirmed that there were no ongoing trials of civilians. However, later in the evening, the director general of Inter-Services Public Relations (ISPR), Major General Ahmed Sharif Chaudhry, said that proceedings against the 102 civilians handed over for trial were already underway. A six-member larger bench, led by Justice Bandial and composed of Justice Ijaz ulAhsan, Justice Muneeb Akhtar, Justice Yahya Afridi, Justice Ayesha Malik, and Jus-
tice Mazahir Ali Naqvi, is hearing the petitions challenging the government’s decision to try civilians in military courts. The government had announced that individuals involved in the violence that erupted on May 9, resulting in the vandalism of various government buildings and army installations, would face trials under army laws. The petitions, filed separately by former prime minister Imran Khan, former chief justice Jawwad S. Khawaja, legal expert Aitzaz Ahsan, and five civil society members, including Piler Executive Director Karamat Ali, urged the apex court to declare military trials unconstitutional. During the previous hearings, Khawaja Ahmed Hussain, the lawyer representing Khawaja, Latif Khosa, counsel for petitioner Aitzaz Ahsan, and civil society lawyers Faisal Siddiqui and Salman Akram Raja presented their arguments. Subsequently, the counsel for Khan took the podium and highlighted conflicting statements from the AGP and Chaudhry. Referring to Monday’s press conference by Chaudhry, the counsel pointed out that
the trial of 102 individuals had been mentioned. He emphasized the conflicting statements between the AGP and the ISPR head. In response, the AGP reaffirmed his earlier statement, asserting: “I stand by my statement even today.” He further suggested that the representatives from the Ministry of Defence, present in the court, could provide a better explanation of the situation. Justice Ayesha remarked: “We are currently examining existing judicial precedents,” indicating that the court was actively considering relevant legal precedents. Additionally, Justice Bandial expressed confidence in the AGP’s statement, redirecting the court’s focus to the ongoing proceedings. During the hearing, Uzair Bhandari, the lawyer representing Khan, argued that the approval of civilian trials in military courts by Parliament required a constitutional amendment. He cited the 21st Amendment, which established that the trial of civilians necessitated a constitutional amendment. Justice Ayesha questioned whether a civilian trial in military courts could be held for internal matters, to which Justice Afridi
said that such matters related to the country’s defense had been addressed in the 21st Amendment. Justice Afridi observed that the ISPR press conference held the day before had provided clarity on the situation. Justice Ahsan mentioned that the court
could not ignore previous examples of civilians being tried in military courts, acknowledging that each case had unique circumstances and reasons. Bhandari argued that any military trial of a civilian should only occur through a constitutional amendment.
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