Government circles optimistic about release of stalled tranche: meeting with IMF not yet fixed

The dates for the next meeting between the International Monetary Fund (IMF) and Pakistan's economic team have not yet been finalised. Sources told Business Recorder here on Wednesday that meeting with the IMF mission is expected in the second half of July, but nothing has been finalised in this regard so far. There is high optimism in respect of the release of the stalled IMF tranche under the StandBy Arrangement (SBA) in government circles.
This, sources said, is in spite of the failure of the government to meet key conditions that led to the stalled SBA since May of 2010, including power sector reforms, elimination of the inter-circular debt and implementation of value-added tax. Sources further said that the IMF must be concerned with increased domestic borrowing by the government and that "after the end of the current fiscal year 2010-11 on June 30, the IMF is expected to review and analyse the domestic borrowing, but Pakistan should control its borrowing to reduce inflation and allow adequate credit to the private sector".