The Finance Minister of Pakistan, Ishaq Dar, announced that the government has made some changes to the budget for the upcoming fiscal year in an attempt to secure a stalled rescue package with the International Monetary Fund (IMF). The government plans to raise Rs215 billion through new taxes and cut spending by Rs85 billion to reduce the fiscal deficit. Pakistan’s ninth review under the IMF’s Extended Fund Facility for the release of $1.2 billion is still pending, with less than a week remaining before the program expires on June 30. The IMF had raised concerns about some measures in Pakistan’s budget that went against the conditions of the program. The government responded by saying it was open to flexibility and engaged in discussions with the IMF to find a solution. Pakistan is in urgent need of an IMF bailout to avoid defaulting, as its reserves have been critically low for several months. The country was supposed to receive the $1.2 billion tranche from the IMF last year, but it has been delayed due to Pakistan’s inability to meet certain prerequisites. The prospects of the deal materializing before the program expires are uncertain. Prime Minister Shehbaz Sharif recently met with the IMF chief to discuss Pakistan’s economic situation and express hope for the timely release of funds.
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