Pakistan Prime Minister Shehbaz Sharif said that his government would have to agree to the bailout conditions presented by the International Monetary Fund (IMF) that are “beyond imagination.” Sharif said that the international financial body was giving a “very tough time” to the country’s Finance Minister Ishaq Dar.
“Our economic challenge at this moment is unimaginable. The conditions we have to fulfill [to complete the IMF review] are beyond imagination,” Sharif said.
The IMF delegation headed by Nathan Porter is in the country for discussing the ninth review of a $7 billion loan programme. Pakistan’s forex reserves have dropped to critically low levels of $3.09 billion as of January 27. These reserves can cover merely 18 days of imports, the Pakistani newspaper Dawn reported.
During the course of this meeting, the IMF mission chief was adamant on measures to bridge the Rs 2 trillion to Rs 2.5 trillion fiscal gap. The Shehbaz Sharif-led government has taken various measures such as hiking petrol prices by up to 16 per cent, increasing the LPG price by 30 per cent, and lifting a price cap on the exchange rate.
Inflation rose to a 48-year-high in Pakistan and citizens are struggling to afford basic food items and amenities, as per the news agency AFP.
Pakistan’s economy is in dire straits due to a balance of payments crisis and high levels of debt amid political chaos and a deteriorating security situation. As the Shehbaz Sharif government tries to get Pakistan out of chaos, former Prime Minister Imran Khan is heaping pressure on the ruling coalition in a bid for early elections.
Khan had negotiated a deal with the IMF in 2019 but could not deliver on promises to cut subsidies and market interventions that helped the common Paksitanis tide over the cost-of-living crisis.
(With agency inputs)
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