PML-N scrambles to revive IMF deal

Finance Minister Ishaq Dar approaches US Ambassador Donald Blome for assistance

ISLAMABAD:

The Pakistan Muslim League-Nawaz (PML-N) government is scrambling to revive the programme with the International Monetary Fund (IMF) amid a steep fall in foreign loan disbursements to just $8.4 billion this fiscal year.

Federal Finance Minister Ishaq Dar has approached US Ambassador to Pakistan Donald Blome for assistance in the restoration of the IMF programme, Express News reported on Wednesday.

Dar reportedly met Blome and discussed bilateral issues of mutual interest. The former requested the latter to help Pakistan in securing the IMF tranche and salvaging the deal.

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Meanwhile, Prime Minister Shehbaz Sharif has left for France, where he hopes to meet IMF Managing Director Kristalina Georgiva on the sidelines of the summit for a new Global Financial Pact in Paris. The premier is slated to be in Paris on June 22 and 23.

Shehbaz has also written three letters to Georgiva in this regard besides speaking to her on the phone but to no apparent avail thus far.

Earlier this month, a cabinet member revealed that the IMF has rejected Pakistan’s request to lower the requirement of arranging $6 billion in new loans, leaving the government with no alternative but to try and revive the deal.

In a policy statement during the National Assembly Standing Committee on Finance, Minister of State for Finance Dr Aisha Pasha emphasized that returning to the IMF was Pakistan’s only option.

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According to Dr Pasha, Pakistan requested the IMF to consider reducing the $6 billion external financing requirement based on new current account deficit data, but the Fund did not agree. She explained that there was an understanding to arrange $3 billion before the staff-level agreement and the remaining $3 billion after the agreement, but the IMF was insisting on “demonstrating the $6 billion”.

When asked about a Plan B in case talks with the IMF fail to yield positive results, Dr Pasha said that, “There is no option other than going back to the IMF, and I categorically say there is no Plan B”. She reiterated that the government’s aim was to pursue the IMF program.

Dr Pasha’s statement stood in contradiction to Dar’s previous position that Pakistan should try to manage with or without the IMF.