Finance Minister Miftah Ismail Saturday said that no contact has been made with the International Monetary Fund (IMF) regarding the letter written by Khyber Pakhtunkhwa Finance Minister Taimur Khan Jhagra as there was “no need for it”.
The IMF Executive Board is set to meet tomorrow (Monday) to approve the $1.17 billion loan tranche for Pakistan.
Reportedly a meeting will also be held between the federal finance minister and the provincial finance minister tomorrow to resolve issues between the federal government and Khyber Pakhtunkhwa.
On Friday, Jhagra withdrew the commitment of his province to run a surplus in the current fiscal year, citing the non-resolution of pending issues between the center and the province.
In his letter, the provincial minister said that the estimated overall impact of not resolving the issues will create a Rs. 100 billion unfunded liability in the Khyber Pakhtunkhwa budget.
Jhagra added that the recent flooding has caused destruction in the province and the damage from the floods is greater than that of the super-floods of 2010. He said that the cost in terms of rescue, relief, rehabilitation, and building back is likely to run into the tens of billions.
In these conditions, and without the resolution of the issues highlighted previously, for the province of Khyber Pakhtunkhwa to actually leave a surplus will be next to impossible, the provincial minister said.
The federal government had agreed in the Memorandum of Economic and Fiscal Policies inked with IMF to present a memorandum of understanding (MoU) duly signed by all provinces for the provision of cash surplus by them.