ISLAMABAD: Prime Minister Imran Khan will once again visit the United Arab Emirates (UAE) to seek billions of dollars in aid as the International Monetary Fund becomes unusually tough on Pakistan on the fiscal and monetary fronts, which is hindering early conclusion of the talks.
Pakistan has also decided to send a second technical level team to China next week after modalities of financial aid by Beijing could not be finalised during the first technical level team visit that ended on Sunday. The aid from Saudi Arabia has also not arrived, putting Pakistan under pressure at a time when the IMF is becoming tougher, said sources in the Finance Ministry.
Prime Minister Imran Khan will visit the UAE today (Sunday), sources told The Express Tribune.
Finance Minister Asad Umar will accompany the premier on a day long visit. Islamabad seeks $6 billion financial assistance package from the UAE in the shape of cash deposits and oil on deferred payments.
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It will be the PM’s second visit to the UAE in the last one and half months. Earlier, Khan had a stopover in Dubai on his return from Saudi Arabia in September where he had also sought aid. Finance Minister Umar, however, denied that there is any link between the IMF conditions and the PM’s UAE visit.
Pakistan and the UAE may sign memorandum of understanding on the financial assistance package, a cabinet minister told The Express Tribune on condition of anonymity. Last month, a UAE delegation had also visited Pakistan and the government had sought from the gulf state $6 billion.
It seems that the government has hurriedly planned the second UAE visit, as the Foreign Office did not announce the plan during its Thursday briefing. The Foreign Office had announced that the PM will go on a two-day state visit to Malaysia on Tuesday. He would be accompanied by a high level delegation.
The key agenda of the PM’s meetings will be bilateral investment and economic cooperation, said the Finance Ministry sources. Foreign Minister Shah Mahmood Qureshi is already in the UAE.
The sources in Finance Ministry said there was a disagreement with the IMF on the extent of fiscal adjustment, privatisation, increase in interest rates and rupee depreciation against the US dollar. The measures suggested by the IMF are extreme, which may create serious problems for the government.
The IMF mission had arrived in Pakistan on November 7 and its visit is scheduled to complete on Tuesday. However, in case the disagreement persists, the IMF may extend its stay for few days. In case the talks reach a deadlock, the IMF team may leave Pakistan without holding a press conference.
The government of Imran Khan had adopted a two-pronged strategy to deal with the external sector mess left behind by the last Pakistan Muslim League-Nawaz (PML-N) government.
It had sought financial assistance from Saudi Arabia, China and the UAE. So far, Pakistan has claimed that Saudi Arabia has promise to give $6 billion aid package but that money too has not yet reached Pakistan.
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A task force comprising officials from State Bank of Pakistan (SBP), Finance Ministry, Ministry of Commerce and Ministry of Planning visited Beijing from November 9 to 11. Against expectations, no announcement was made at the end of the task force visit.
The sources said Chinese were not happy with the level of preparation of Pakistani officials, particularly of Ministry of Commerce. They said a technical level delegation would again go to China next week comprising officials from Finance Ministry and the SBP.
Pakistan hopes to get at least commercial loans from China to immediately shore up its gross official foreign currency reserves that have already slipped to $7.4 billion by end of last week. The reserves are sufficient to back only six weeks imports.
Chinese Deputy Chief of Mission to Islamabad Zhao Lijian tweeted on Friday that “modalities of Chinese assistance to Pakistan are being worked out mutually and experts from both sides are in contact to nail down details of the new package”. Through his Twitter handle he further said China was trying to extend every possible support to Pakistan but “we do not plan to reveal exact numbers”.
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