Pakistan, IMF seal the deal.

ISLAMABAD -- Pakistan and International Monetary Fund (IMF) on Sunday finalised the bailout package after months-long talks pertaining to the size of the bailout package as well as conditions attached to it.

Speaking to the media, Prime Minister's Advisor on Finance Hafeez Sheikh said that Pakistan and IMF have reached an agreement for a $6 billion bailout package under extended fund facility for a period of three years.

He said that the agreement will improve the debt situation and sent a positive signal to the world to attract foreign investment. He added that the IMF programme will provide an opportunity to bring structural changes to handle issues pertaining to loss-making state-owned enterprises, exports, and to enhance revenue.

Meanwhile, the IMF has also announced that it has reached a staff-level agreement on economic policies that could be supported by a 39-month Extended Fund Arrangement (EFF) for about US$6 billion, but the agreement is subject to approval by IMF management and Executive Board.

'This agreement is subject to IMF management approval and to approval by the Executive Board, subject to the timely implementation of prior actions and confirmation of international partners' financial commitments. The program aims to support the authorities' strategy for stronger and more balanced growth by reducing domestic and external imbalances, improving the business environment, strengthening institutions, increasing transparency, and protecting social spending,' the international lender said in a statement.

'The EFF aims to support the authorities' ambitious macroeconomic and structural reform agenda during the next three years. This includes improving public finances and reducing public debt through tax policy and administrative reforms to strengthen revenue mobilization and ensure a more equal and transparent distribution of the tax burden. At the same time, a comprehensive plan for cost-recovery in the energy sectors and state-owned enterprises will help eliminate or reduce the quasi-fiscal deficit that drains scarce government resources,' the statement added.

IMF also said that the forthcoming budget for FY2019/20 is the first critical step in the authorities' fiscal strategy. 'The budget will aim for a primary deficit of 0.6 per cent of GDP supported by tax policy revenue mobilization measures to eliminate exemptions, curtail special treatments, and improve tax administration. This will be accompanied by prudent spending...