ISLAMABAD – An International Monetary Fund team arrived in IslamabadWednesday for talks on a possible IMF bailout, even as Pakistan insisted ithad solved its immediate balance of payments crisis.
Speaking shortly after Prime Minister Imran Khan returned from Beijing,Pakistan’s finance minister said Tuesday that assurances from China —combined with a pledge made by Saudi Arabia last month — meant thatPakistan’s immediate fiscal woes were “over”.
“We had a gap of $12 billion and in that $12 billion, six billion came fromSaudi Arabia and the rest came from China,” Asad Umar told reporters,without specifying the nature of the Chinese assistance.
The finance secretary and the governor of the state bank will attend ameeting in Beijing on Friday to finalise the terms of the assistance, headded.
Pakistan secured $6 billion in funding from Saudi Arabia and struck a12-month deal for a balance of payments lifeline during Khan’s visit inOctober.
Despite the pledges, the ministry of finance said the Pakistan would stillseek broader IMF support for the government’s long term economic planning.
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Since taking power in August, former cricketer Khan has been searching forways to rally a struggling economy hit by inflation and shore up thecountry’s dwindling foreign currency reserves.
As well as a highly-publicised austerity drive, including auctioning offgovernment-owned luxury automobiles and buffaloes, the new prime ministerhas also made overtures to the IMF — which has bailed Pakistan outrepeatedly since the 1980s.
However, Islamabad received billions of dollars in Chinese loans to financeambitious infrastructure projects, and the US — one of the IMF’s biggestdonors — has raised fears that Pakistan could use any bailout money torepay its debts to Beijing.
Islamabad — which last received an IMF bailout in 2013 to the tune of $6.6billion — has refuted these claims. – APP/AFP
