The International Monetary Fund (IMF) has approved a package of $1 billion and $ 388.6 million for Rapid Financing Instrument (RFI) for Pakistan in the wake of the negative economic impact caused by the Coronavirus.
According to the Dawn newspaper report, the IMF’s statement said that the IMF’s executive board paid $1.38 billion (50% quota) under RFE to meet the balance of payments due to the Coronavirus.
The IMF said that with the reduction of the virus’s impact, the relevant authorities would have the opportunity to review the implementation of the Extension Fund Facility’s (EFF) policies, which would yield better results.
The IMF is in constant contact with Pakistani authorities and talks with the latest EFF will begin once the effects of the virus are reduced, the statement said.
The virus has had a significant impact on the Pakistani economy, said the executive board’s first deputy managing director and acting chair, Jeffrey Okamoto.
On the other hand, in view of the economic situation caused by the virus in Pakistan, timely decision was announced to reduce interest rate by 2%, with interest rate, i.e. policy rate falling to 9%.
It should be noted here that in the last one month, interest rates by the State Bank have been reduced for the third time and the overall interest rate has been reduced by 4.25% in one month until now.
The Monetary Policy Committee said other measures taken by the State Bank, including interest rate reductions, would help to provide loans to companies at a discounted interest rate, a one-year extension of basic payment, loan repayment period. From 90 days to 180 days, hospitals are dealing with low-interest-rate loans to deal with the Coronavirus so that they do not have to leave their employees in this crisis situation.
On April 13, the Asian Development Bank (ADB) decided to give developing countries a $20 billion package to compensate for the economic losses caused by the Coronavirus outbreak. On the other hand, Prime Minister Imran Khan also announced a relief package that included Rs.200 billion for the working class, Rs.100 billion for the export and industry, Rs.150 billion for poor families, Rs.50 billion for utility stores, to ensure availability of wheat. Rs.280 billion for petroleum products, and reduction of Rs.15 per liter was introduced in petrol prices, electricity/gas bills for 3 months installment relief, Rs.50 billion for medical workers and other areas were granted.