Finance Minister Muhammad Aurangzeb announced on Wednesday that Pakistan is preparing to launch its first-ever Panda Bonds in China to diversify funding sources, following strong interest from Chinese investors.
Briefing the Senate Standing Committee on Finance, chaired by Senator Saleem Mandviwalla, the finance minister said the first phase would see an issuance of $250 million bonds. He clarified that the government was not imposing any additional taxes and highlighted that talks with the International Monetary Fund (IMF) were progressing positively.
Aurangzeb noted that Pakistan had repaid $500 million Eurobonds a day earlier and would make another $1.3 billion repayment in April. He reiterated the government’s commitment to raising the tax-to-GDP ratio to 11% by the end of the current fiscal year.
Responding to questions on first-quarter tax shortfalls, he pointed out that several major cases were pending in courts and their resolution would significantly enhance revenue collection.
The minister said signs of economic stability were becoming visible and stressed the need to explore opportunities in cryptocurrency. He mentioned that work was progressing on the Pakistan Virtual Assets Regulatory Authority Bill, which aims to bring cryptocurrency under regulation.
Meanwhile, Pakistan and the IMF formally launched discussions on September 29 for the second review of the $7 billion loan programme and the first review of the $1.3 billion climate financing programme. The Pakistani side assured the IMF of full compliance with commitments under the bailout plan.
The IMF team, led by its mission chief for Pakistan, is also reviewing the impact of recent floods on fiscal targets. Successful negotiations would pave the way for approval of the next tranche by the Fund’s board.