The Economic Outlook for 2022-23 the strong containment of imports through the holding back of import LCs. Also, there has been a significant decline in the price of imported crude oil. ii) Exports are likely to be smaller by$3 billion, especially because of the lack of growth in world trade due to a deeper global recession and reduced exports of rice and textiles. The latter will be constrained by shortage of imported inputs. iii) Home remittances are likely to be lower by over$2 billion in the presence of a big spread between the official and open market exchange rate. iv) Overall, the current account is likely to be smaller by$1 billion, at the level of$8.3 billion. This is consistent with the first four-month outcome in 2022-23 of a current account deficit of$2.8 billion. v) Foreign investment, in particular the portfolio investment in Sukuk/ Eurobonds, is like ­ly to be substantially lower. Pakistan will experience great difficulty in floating bonds. The IMF Program projection had assumed financing of$3 billion from these bonds. Also, foreign direct investment is likely to be substantially lower as there has been a restriction imposed on the repatriation of profits which will deter new investment. vi) Disbursements of loans into the Government account are also likely to be much small ­er by over$6 billion. The IMF projections assume a very large inflow of commercial loans, which is now unlikely given the higher risk perceptions of Pakistan. However, it is assumed that the IMF program will complete its tenure and$3.5 billion will become available from this loan facility. The bottom line in the balance of payments projections is that there is the high level of risk that the foreign exchange reserves will remain at the current low level of below$7 billion, despite the umbrella of an IMF program. There will remain the risk that Pakistan may reach a point where it will not be able to honor its repayment obligations, if external inflows are even smaller. 4.4 Budgetary Projections Prior to the Floods The budgetary magnitudes for 2022-23 presented in the IMF Staff Report coincide with the estimates by the Ministry of Finance. They represent the consolidated position of the federal and provincial governments. The key budgetary magnitudes are presented in Table 4.8. 55