ISLAMABAD :. August 15, 2022. Pakistan government has sent back letter of intent (LoI) to the International Monetary Fund (IMF) after duly signed by the concerned authorities.
Sending of LoI to IMF after duly signed by the competent authority Is one of the procedural conditionalities for IMF to approve release of $1.17 billion tranche for Islamabad under Extended Fund Facility (EFF) programme.
With sending of signed LoI , Pakistan government has inched closer to get much- needed $1.17 billion tranche from IMF.
The Finance ministry has made an official announcement here on Monday, confirming sending of LoI to IMF after signing it by the concerned authorities .
IMF had conducted staff level agreement with Pakistani authorities some three months ago and then attached a number of conditionalities for Islamabad to qualify for its loan under EFF programme .
Pakistan has to take a number of harsh decisions like repeated upward revisions in oil, gas and power rates .
These decisions cost Shahbaz government dearly as his party lost by-elections in July last in his home province.
The ruling alliance took responsibility of hard decisions and tried to persuade to the public which has been pushed in unbearable price -hike diue to continuous increase in oil, gas and power rates that hard decisions were needed to avert default of Pakistan on its soverign liabilities.
The ruling alliance is hoping for addressing price- hike issue before it goes for next general elections in the country.
In this scenario, the agreement with IMF and get the country out of risk of default is of extra ordinary significance .
With a hope of early release of tranche by IMF , Pakistan can get stability on economic front and go for next elections in first half of next year.
The IMF board is likely to consider Pakistan’s case for grant of loan and after sending of a signed LoI , there seems no issue for Pakistan in getting IMF tranche of $ 1.17 billion.
Finance minister , Mifah Ismail, had told a private TV channel other day that IMF is also considering Pakistan’s request for additional grant of $ 2.8 billion loan.