As the economic crisis in Pakistan worsens with depleting foreign currency reserves barely enough to pay for three weeks worth of imports, the country agreed on Saturday before the International Monetary Fund (IMF) to increase the policy rate by 2 per cent -- one of the conditions to secure the Fund's bailout package, media reports said.
Virtual negotiations with the IMF continued till late at night on Friday, as the officials from the international lender "painstakingly reviewed" every aspect, Geo News reported.
The sources said that Pakistan has agreed to raise its policy rate by 2 per cent. It currently stands at 17 per cent, the report said.
The sources also added that details regarding reforms in the power sector are being finalised and after the settlement, a staff-level agreement (SLA) will be signed.
The power sector has remained a hurdle so far as it has become one of the major stumbling blocs between Pakistan and the IMF.
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Pakistan has also briefed the lender in detail on external financing till June, the sources said.
The sources said IMF is also holding talks with those countries in order to get assurance. There's no discussion being held regarding the political situation of Pakistan, they added, Geo News reported.
Pakistani authorities have been negotiating with the IMF since early February over policy framework issues and are hoping to sign a staff-level agreement that will pave the way for more inflows from other bilateral and multilateral lenders.
Once the deal is signed, the lender will disburse a tranche of more than $1 billion from the $6.5 billion bailout agreed to in 2019, Geo News reported.