ISLAMABAD: The Pakistan Stock Exchange showed a bullish trend on Thursday morning despite Prime Minister Imran Khan’s statement that his administration might decide against seeking the International Monetary Fund’s (IMF) help for a bailout package.
The country’s stock market had recently suffered significant losses due to the increasing economic uncertainty that resulted from the new political administration’s discussions of its balance-of-payments crisis, dwindling foreign reserves and financing options.
In this context, Khan’s statement came as a surprise, especially since it came very close on the heels of Finance Minister Asad Umar’s meeting with IMF’s Managing Director, Christine Lagarde, in Indonesia last week.
The IMF, on its part, had sought a “debt transparency” from Pakistan, which would also highlight details of its negotiations pertaining to the China-Pakistan Economic Corridor (CPEC) and the overall financing mechanism of the multibillion-dollar connectivity project. The IMF is also expected to send its delegation to the country in the next few days, as the two sides focus on the modalities of the financial assistance.
Pakistan has been seeking aid from the IMF since the 1980s. Yet, such financial arrangements have not come without its set of political implications, since the financial body dictates its own terms and conditions on the country’s economic management, leaving little room for its governments to take autonomous economic decisions and resulting in a great burden on its population.
Considered a deeply unpopular move by the citizens, PM Khan had shown his resolve in avoiding the IMF route in several pre- and post-election speeches and public appearances. However, after carefully analyzing the economic situation of the country, his Pakistan Tehreek-e-Insaf administration decided to reach out to the international financial institution for aid, with reports indicating that Pakistan could borrow up to $15 billion to fix its ailing economy.