IMF Chief Goergieva's 'heart goes out for Pakistanis' but remains firm on taxes, subsidies

'My heart goes out to the people of Pakistan,' said International Monetary Fund (IMF) chief, Kristalina Georgieva. Speaking to German broadcaster DW Asia, Georgieva acknowledged that Pakistan is ravaged by the unprecedented floods in 2022, which affected over one-third of its population, and listed their expectations from the country.

"What we are asking for are steps that Pakistan needs to take to be able to function as a country and not to get into a dangerous place where its debt needs to be restructured, Goergieva said, moving on to highlight the two points that the IMF is putting emphasis on. 

Goergieva said, "Number 1- tax revenues. Those who can, those that are making good money, public sector, private sector, they need to contribute to the economy and secondly, to have a fairer distribution of the pressure by moving subsidies only towards the people who really need it. It should not be like the wealthy benefit from subsidies. It should be the poor who benefit from them."

She concluded by saying that the IMF is 'very clear that it wants the poor people of Pakistan to be protected'.

IMF delays the release of $1.1 billion of 2019 deal

IMF has delayed the release of a crucial $1.1 billion portion of a 2019 deal worth $6 billion, on hold since December over Pakistan’s failure to meet the terms. The officials of the IMF are reviewing Pakistan’s compliance with a 2019 agreement. The latest round of the talks between Pakistan and the IMF concluded Friday, February 10, with the fund recommending steps including imposing new taxes.

Analysts say the revival of the IMF’s bailout will help Pakistan because a release of the next installment of loans could encourage other international financial institutions to help the Islamic nation.