IMF says meeting on Pakistan to proceed as scheduled

The International Monetary Fund’s Executive Board meeting to review Pakistan’s ongoing program will be held as scheduled on Friday despite market speculation that it could be delayed following India’s reported efforts to block Pakistan’s funding request.

“As has been announced, the Executive Board meeting for the first EFF [Extended Fund Facility] review and RSF [Resilience and Sustainability Facility] request is scheduled for May 9,” said Mahir Binici, the IMF’s resident representative, told Nukta.

The board is set to review the first progress report under Pakistan’s ongoing $7 billion bailout program and consider approval of a new $1.3 billion arrangement under the climate-focused RSF.

Last month, IMF reached a staff-level agreement with Pakistan on the $1.3 billion facility, while also completing the first review of the 37-month EFF program.

According to some reports, India has raised concerns with the IMF on its loans to Pakistan, asking for a review amid heightened tensions following an attack in Indian-administered Kashmir.

In a related move, Krishnamurthy V. Subramanian, India’s executive director at the IMF and a former chief economic adviser to the Indian government, was abruptly recalled six months before completing his three-year term.

Given the IMF Board’s role in approving funding and policy measures, the timing of Subramanian’s exit — so close to a strategically important vote — has drawn attention, said a market observer.

It’s uncommon for Indian nominees at the IMF to be recalled mid-term. Subramanian’s predecessor, economist Surjit Bhalla, served a full term and was re-elected for a second cycle. Most Indian EDs in the past have either completed or extended their terms at IMF, the observer said.