ISLAMABAD, Aug 4: Pakistan plans to repay $2.9 billion to the International Monetary Fund in 2012-13 in 12 monthly instalment of $241 million each, said a Finance Ministry source on Saturday.
The country received $1.18 billion in Coalition Support Fund from the US this week, which has given financial managers some fiscal space to repay IMF loan in monthly installments, according to the official.
Pakistan repaid $1.2 billion to IMF in 2011-12, out of the total loan of around $8 billion.
The official claimed that the first instalment of $241 million in July has been paid and dispelled any notion that it would have a negative impact on either foreign exchange reserves or exchange rate.
“We will not have problem in the repayment to the IMF for bailout package of over $7.5 billion,” the official said.
The rupee ended at 94.50/56 to the dollar on Friday but has firmed since hitting a record low of over Rs95 in June.
Foreign exchange reserves stood at $14.57 billion in week ending July 27, and are expected to rise following the CSF payment of $1.18 billion.
Sources said that mending relations with the US and reimbursement of CSF has provided some breathing space for economic managers and eased some pressure from the current account deficit which swelled to around $4.8 billion, or 1.9 per cent of gross domestic product.
The current account posted a surplus of $214 million in 2010-11.
The official said more foreign inflows were expected in the coming months from other donors especially after improvement in relations with the US. The US also disbursed $280 million for the energy sector this week.
Analysts however remained cautious, especially for next fiscal year, saying the government may have to negotiate another loan programme with the Fund to ensure smooth repayment of the remaining instalments to the IMF.
The official said that a decrease in imports and continuous momentum of remittance is critical for the country to ease pressure on the current account and avert more depreciation of rupee.
Remittances from Pakistanis abroad rose 17.73 per cent to $13.186 billion in 2011-12, compared with $11.2 billion the previous year.
The official stressed the need for the government to put the resolution of energy crisis as its top priority in order to increase exports and to avert a balance of payments crisis.
The government projected that foreign exchange reserves held by the State Bank of Pakistan at $8 billion in the macroeconomic framework for 2012-13. The central bank’s reserves were $10.14 billion last week.
A similar situation of foreign exchange reserves had compelled the government in 2008 to seek a $7.6 billion IMF bailout package, which was increased to $11.3 billion but the country was not eligible for the last two disbursements of $3.2 billion due to failure to comply with the performance criteria.