Pakistan Eyes IMF Support, Seeks Rs 49,733 Crore Loan To Avoid Default After Election

Pakistan is facing substantial debt repayment commitments, prompting the country to consider seeking a new loan from the International Monetary Fund (IMF). The proposed loan, anticipated to be at least $6 billion (Rs 49,733 crore approx), is aimed at assisting the incoming government in meeting its financial obligations and addressing the challenging economic landscape. The funds will likely play a crucial role in managing the debt repayment schedule and stabilizing the country's fiscal situation.

Pakistan Initiates Talks With IMF for Financial Support Amid Economic Challenges

indiatimes

To address its economic challenges and meet impending debt obligations, Pakistan is set to engage in negotiations with the International Monetary Fund (IMF) for an Extended Fund Facility. The discussions are anticipated to commence in March or April, as the country seeks financial support to navigate through its economic complexities and ensure stability in the face of looming debt repayments.

Pakistan had secured a temporary bailout from the International Monetary Fund (IMF) to prevent default last summer. However, with the expiration of the program next month, the incoming government faces the task of negotiating a long-term arrangement to maintain stability in the country's $350-billion economy.

Before obtaining the bailout, Pakistan had to implement several measures mandated by the IMF. These measures included revising the budget, raising the benchmark interest rate, and adjusting electricity and natural gas prices to meet the conditions set by the global financial institution.

IMF Loan Negotiations Crucial for Pakistan's Economic Stability, Fitch Warns

AFP

Pakistan's vulnerable external position means that securing financing from multilateral and bilateral partners will be one of the most urgent issues facing the next government, ratings agency Fitch said on Monday.

"A new deal is key to the country’s credit profile, and we assume one will be achieved within a few months, but an extended negotiation or failure to secure it would increase external liquidity stress and raise the probability of default," a Bloomberg report said.

(With inputs from Reuters and Bloomberg)

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