Pakistan and IMF have reached an understanding to refrain from further increases in interest rates during their ongoing policy-level discussions.

Today marks the final day of talks between Pakistan and IMF mission, and sources indicate that the economic review talks with the IMF mission are on the verge of success.

According to these sources, the IMF mission and the economic team have concluded discussions across all sectors. Caretaker Finance Minister Shamsmad Akhtar led the policy-level negotiations with the IMF mission. Today, it is anticipated that the IMF mission and the economic team will finalize the draft of the Memorandum of Economic and Financial Policies (MEFP).

In line with the discussions, there is an agreement with the IMF to impose a windfall tax of up to 55 billion rupees on bank profits. The windfall tax on bank profits is set to be implemented for the financial years 2021 and 2022, with collection slated for the upcoming month.

Officials from the Ministry of Finance state that no amendments to the Finance Bill are necessary for the imposition of the windfall tax on banks, but approval from the Federal Cabinet is required.

As per Ministry of Finance sources, both parties have concurred not to further escalate the interest rates. A meeting to finalize these agreements is expected shortly.

Read more about “Apprehensions regarding the management of imports within the IMF have progressed to the concluding phase of negotiations.”.