Agrees to hike interest rate by 200 basis points
A woman prepares tea for her family at their home in Lahore. Pakistan’s finances have been wrecked by years of financial mismanagement and political instability. Pic/AFP
The Pakistan government has agreed to increase the policy interest rate, which stands at 17 per cent by two per cent or 200 basis points to meet another condition set by the International Monetary Fund (IMF), The Express Tribune reported.
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With the new decision, Pakistan has accepted another pre-condition of the IMF for the release of USD 1.1 billion in critical funding, a part of the USD 6.5 billion bailout package, the report said, adding that Pakistan has announced the increase in interest rate based on rates the government set in the auction to raise domestic debt. The decision by Pakistan authorities will push the interest rate to 19 per cent, just below the previous record of 19.5 per cent set in October 1996, The Express Tribune reported.
Sources in Pakistan’s Ministry of Finance said that a technical-level discussion had virtually taken place between Islamabad and the IMF review mission. The sources revealed that there was an expectation that Pakistan will increase the interest rate by two per cent, according to The Express Tribune report. According to sources, the discussions between the Pakistan government and IMF officials were in the final stage on some issues of the power sector.
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US Republican Party, Grand Old Party (GOP) Presidential candidate Nikki Haley has said that if voted to power, she will cut every cent in foreign aid for countries that hate the US. This includes China, Pakistan and other adversaries as “a strong America doesn’t pay off the bad guys”. “I will cut every cent in foreign aid for countries that hate us. A strong America doesn’t pay off the bad guys. A proud America doesn’t waste our people’s hard-earned money. And the only leaders who deserve our trust are those who stand up to our enemies and stand beside our friends,” Haley, the Former Governor of South Carolina and former US ambassador to the UN, wrote in an op-ed for New York Post.
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Total bailout package for Pak
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