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Pakistan’s rupee plunges as IMF says mission to visit next week
Pakistan is seeking $1.1bn from the fund, part of its $6bn bailout package, to avoid default.The Pakistani rupee has dived to a historic low against the United States dollar after an exchange cap was lifted as the cash-strapped country seeks to unlock a vital bailout from the IMF.
The Washington-based lender has yet to approve the release of the crucial instalment of $1.1bn, originally due to be disbursed in November last year as part of a $6bn bailout secured in 2019.Talks with the IMF about reviving the bailout stalled in recent months, with the institution demanding more progress on fiscal consolidation and economic reforms.
The rupee closed at 230 to the US dollar on Wednesday. It slipped further, trading at 255 for $1 within hours of the market reopening on Thursday. Hours later, Pakistan’s Central Bank confirmed the currency had plummeted by 9.6 percent against the US dollar after the removal of price caps imposed by the government but which the IMF opposed.
Financial expert Malik Bostan told The Associated Press news agency the value of the rupee dropped mainly due to the delay in the revival of the IMF’s bailout talks, amid depleting foreign exchange reserves, but expected it to stabilise as the negotiations pick up again.On Thursday, the IMF’s resident representative said an IMF vision will visit Pakistan later this month to discuss the stalled ninth review of the country’s current funding programme.
“At the request of the authorities, an in-person Fund mission is scheduled to visit Islamabad January 31st – February 9th” to continue discussions,” Esther Perez Ruiz was quoted as saying by the Reuters news agency.
A successful visit is critical for Pakistan, which is facing an increasingly acute balance of payments crisis and is desperate to secure external financing, with less than three weeks’ worth of import cover in its foreign exchange reserves.
Multilateral and bilateral financing pledges for Pakistan’s effort to rebuild after devastating floods last year are also tied to the country getting the green light from the IMF.
This week, Prime Minister Shahbaz Sharif said his government was ready to adhere to the fund’s “tough conditions” to revive the $6bn bailout package, which was increased by another billion in 2020.
Sharif has been struggling to put the economy on track since taking office last year, blaming former Prime Minister Imran Khan and his government for the economic malaise. Khan was removed from office in April 2022 through a parliamentary vote of confidence, and has since been campaigning for early elections.
Thousands of shipping containers packed with raw materials for industry, foodstuffs, and medical equipment are being held up at Karachi port because banks have refused to guarantee importers’ dollar transactions.
The Matara Magistrate’s Court has ordered the arrest of former IGP Deshabandu Tennakoon, and seven others said to be responsible for the shooting incident that took place in front of the W15 Hotel in Weligama, Matara on December 31, 2023.
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The responsibility of revitalizing both the economy and the fractured social fabric falls on everyone – President
President Anura Kumara Disanayake directed the District Secretaries to allocate Rs. 1,400 billion in recurrent expenditure for the implementation of productive projects at the grassroots level over the next eight months.
The President made these remarks during a discussion held with the District Secretaries, on Thursday (27) at the Presidential Secretariat.
The President also emphasized that by developing the rural economy, the country’s economic growth could be elevated by 3% to 4%. He stressed the need to enhance existing economic opportunities and identify new sources of growth during the expansion of the economy to rural areas.
The pension schemes proposed in the 2025 budget were also deliberated upon during this meeting.
Moreover, the President pointed out that there is a prevailing negative perception of the public sector and that inefficiency within government services has contributed to this situation. He underscored the necessity of creating satisfied and effective government officials, and emphasized the need to improve the efficiency of public services.
Currently, 30,000 vacancies have been identified within the public service, and the President stated that the government plans to recruit for these positions in categories, which would complete the mid-level staffing of the public service.
The President emphasized that development is not limited to constructing buildings and bridges but also involves uplifting the fractured social structure, a responsibility that primarily lies with the District Secretaries.
Additionally, the District Secretaries raised issues specific to their districts, which were brought to the President’s attention, and extensive discussions were held on possible solutions and proposals.
The meeting was attended by the Minister of Public Administration, Provincial Councils and Local Government, Dr. Chandana Abeyratne; Secretary to the President, Dr. Nandika Sanath Kumanayake, Secretary to the Ministry of Public Administration Aloka Bandara, as well as the District Secretaries.
A discussion on the current security situation in the country was held on Thursday (27) at the Presidential Secretariat between President Anura Kumara Disanayake and senior officials of the Sri Lanka Air Force.
The meeting focused on future security measures, with in-depth discussions on enhancing the Sri Lanka Air Force as a maritime security air force within the Indian Ocean region. The Air Force’s support for operations conducted by the Sri Lanka Army and Navy was also extensively deliberated.
Additionally, the meeting addressed the budgetary allocations for the Air Force in the latest national budget, as well as the current requirements of the force.
The discussion was attended by Deputy Minister of Defence Aruna Jayasekara, Secretary to the Ministry of Defence Air Vice Marshal Sampath Thuyacontha, Air Force Commander Air Marshal Bandu Edirisinghe, and several other senior Air Force officials.
Matara MC orders arrest of former IGP Deshabandu Tennakoon
The responsibility of revitalizing both the economy and the fractured social fabric falls on everyone – President
President meets senior Air Force officers
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