Cash-strapped Pakistan seeks US assist to safe ‘lenient treatment’ from IMF: Report

Pakistan has approached the United States in search of its assist to safe “lenient treatment” from the International Monetary Fund (IMF), stories mentioned. The cash-strapped nation has been in talks with the IMF to safe a $1 billion mortgage.

Pakistan’s longtime ally China is the one nation that has refinanced USD 700 million to Islamabad (Photo: Reuters/File)

By India Today World Desk: Pakistan, which is hit by a extreme financial disaster, has determined to hunt assist from the United States to safe “lenient treatment” from the International Monetary Fund (IMF). The improvement comes amid the delay within the staff-level settlement with the IMF, Geo News reported.

Pakistan is awaiting a much-needed USD 1.1 billion tranche of funding from the Washington-based IMF. The cash-strapped nation has been in talks with the IMF to safe a $1 billion mortgage, which has been pending since late final 12 months over coverage points. It is a part of a stalled $6.5 billion bailout package deal, initially permitted in 2019.

The IMF has requested Pakistan to get affirmation on exterior financing wants of $6-7 billion from the Kingdom of Saudi Arabia, the UAE, Qatar and multilateral collectors to fill the hole until the tip of June 2023, The News International reported.

After failing to persuade the lender, Islamabad is left with no choice however to hunt assist from Washington and its western allies, so as to safe “lenient treatment” from the IMF for shifting in direction of the staff-level settlement, the report mentioned.

According to stories, the IMF held a remaining assembly with the officers of the State Bank of Pakistan (SBP) on Monday, a senior authorities official mentioned. It is now being hoped that the staff-level settlement could be signed within the subsequent few days.

Islamabad is left with no choice however to hunt assist from Washington DC and its western allies, so as to safe ‘lenient treatment’ from the IMF for shifting in direction of a staff-level settlement.

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PAK MINISTER CONTACTS US DIPLOMATS

Pakistan’s Finance Minister has already established contacts with the US diplomatic corps, based mostly in Islamabad, stories mentioned. The minister has requested the officers to assist the tip the lingering stalemate with the assistance of the US treasury division.

“Without the blessing of Uncle Sam, things may not move in the desired direction, despite Pakistani authorities claiming that they had implemented all prior actions under the advice of the IMF, which were possible for them,” sources were quoted as saying by the report.

“Now the IMF is asking to get 200 per cent assurances from the friendly countries and multilateral creditors to fill the financing gap of USD 6-7 billion on external account till the end of June 2023,” the report added.

Pakistan’s economic system is in dire straits. The international alternate reserves fell to a critically low degree of USD 2.9 billion a number of weeks in the past. Pakistan’s all-weather ally China is the one nation that has refinanced USD 700 million to Islamabad.

ALSO READ | Explained: Key elements behind Pakistan’s worsening financial disaster

Pakistan and the IMF have held a number of rounds of talks however have failed to succeed in an settlement. Islamabad has been endeavor key measures resembling elevating taxes, and eradicating blanket subsidies and synthetic curbs on the alternate price to safe funds to avert an financial disaster.

Meanwhile, the Bank of America group has mentioned that China can rescue Pakistan due to its shut ties with the nation, The Dawn reported. Pakistan might want to pause debt repayments if it doesn’t safe funding from the IMF quickly sufficient, a US financial institution warned, the report mentioned.

(With company inputs)

Published On:

Mar 14, 2023