• Flood challenges, missed revenue targets dominate policy-level talks with IMF
• FBR, Punjab and Sindh govts under critical scrutiny for missing target, failing to meet cash surplus commitments
• Power sector shows improved recovery, lower circular debt

ISLAMABAD: Pakistan appears well-placed to secure over $1 billion as the third tranche of the Enhanced Fund Facility (EFF) despite some slippages, as the authorities enter policy-level talks with a visiting review mission of the International Monetary Fund (IMF) on Monday.

Informed sources said technical-level discussions had been concluded, indicating that the two sides would need to agree on a couple of waivers during policy-level engagements before wrapping up the review with Finance Minister Muhammad Aurangzeb by the weekend (Oct 9-10).

While the power sector has shown unusual performance in terms of improved recovery and a reduction in circular debt — through diversion of fiscal space allocated to subsidies and fresh replacement loans — federal revenues and provincial performance, particularly in promised budget surpluses and agricultural tax collections, have emerged as weak areas.

A combination of additional measures to be worked out over the next four days, along with relaxations in view of flood-related challenges, is expected to pave the way for the conclusion of the second review. This would lead to the disbursement of the next tranche worth over $1bn by early next month, subject to IMF board approval. The global political environment remains favourable for Pakistan, with major voting members backing the........

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