IMF rejects Pakistan’s claims of meeting conditions to secure USD 6 Bn loan

The International Monetary Fund (IMF) has reportedly rejected Pakistan’s assertion that it has fulfilled all the necessary conditions to qualify for funds under a previously agreed-upon loan facility.

As per a report in The Express Tribune, the IMF’s assessment of Pakistan’s budget for the coming fiscal year poses a new hurdle for the crisis-stricken nation, as the funds are critical to addressing its dire balance of payments crisis.

A staff-level agreement to release $1.1 billion from the IMF, which had been postponed for various reasons since November 2022, remains outstanding. While repayments, in debt and interest, owed to foreign debtors amounting to USD 4 billion by June this year, Islamabad’s gross official foreign exchange reserves remain at a lowly USD 4.5 billion.

The external debt repayments, including interest, for the July-December period amount to USD 11 billion. Pakistan needs to arrange funds to repay the loans during the first half of the next fiscal year. The IMF, already agitated by the government’s contradictory claims about the completion of the conditions, may not offer any major relief to Pakistan.

Meanwhile, Pakistani authorities, including Prime Minister Shehbaz Sharif and Finance Minister Ishaq Dar have claimed that all prior actions necessary to complete the 9th review have been met, a claim which has reportedly been negated by the IMF.