ISLAMABAD: The International Monetary Fund (IMF) has said the recent floods are unlikely to cause major setbacks to Pakistan’s economic growth or revenue collection this fiscal year, noting that except for Punjab, provinces have not reported significant damages.
According to government sources, the IMF shared its views during opening meetings with Finance Minister Muhammad Aurangzeb as part of the ongoing review talks, which began on September 25 and will continue until October 8. The lender indicated that initial assessments suggested no major impact on growth or tax revenues, though it will await Punjab’s final damage report.
The Planning Commission has estimated overall economic losses at around Rs360 billion — or 0.3pc of GDP — but still expects growth between 3.7pc and 4pc, close to the 4.2pc target. Officials noted that higher-than-expected sowing of rice and sugarcane would offset crop losses, while the current account deficit is not projected to widen since additional imports are unlikely.
The IMF urged Pakistan to accelerate governance reforms, including publication of its Governance and Corruption Diagnosis Assessment report, and highlighted low provincial spending on health and education. Provinces assured the lender that they could manage rehabilitation needs without additional resources, though Punjab, the worst-hit, is preparing a separate package.
Successful completion of the review would unlock over $1.2 billion in IMF disbursements under two loan programmes.
Story by Shahbaz Rana
