Islamabad: On Tuesday, Prime Minister Shehbaz Sharif said the IMF wants friendly countries to meet external finance commitments before releasing bailout funds.
Since early February, the lender has been negotiating with Islamabad to resume $1.1 billion in funding. Held since November, part of a 2019 $6.5 billion rescue.
Pakistan needs the funds to unlock other external loans to avoid defaulting on its debts. As its central bank reserves plummet to barely four weeks of imports.
In a speech to Parliament, Sharif said. “Now we are being told that the commitments from friendly countries be fulfilled and God willing we will.
Saudi Arabia, China, and the UAE have pledged to help Pakistan fund its balance of payments.
On Friday, an IMF official indicated a few remaining issues, including a fuel pricing mechanism, resolved before signing an agreement.
Sharif had already announced the government’s plan to charge affluent users extra for fuel to subsidise inflation-hit poor consumers. It reached a 50-year high in February.
The IMF’s permanent representative in Pakistan, Esther Perez Ruiz, claimed the government hadn’t consulted the fund about the scheme.
Before lending, Islamabad must explain the fuel strategy.
The IMF declined Reuters’ fuel price system comment.
