ISLAMABAD: Pakistan’s new government plans to tap Middle Eastern commercial banks for financing after securing a new and long-term bailout loan from the International Monetary Fund (IMF) in the coming months, the new finance chief said on Wednesday.
The first order of business for new finance minister Muhammad Aurangzeb will be to seek a fresh Extended Fund Facility (EFF) from the IMF after a current standby arrangement expires on April 11. Pakistan bagged the last-gasp rescue package last summer to avert a sovereign default. The final review this week, if successful, will release a last tranche of around $1.1 billion.
“Once we conclude the [new] Extended Fund Facility, we should be able to approach Middle Eastern banks, which have ended their whole business and appetite, for commercial borrowing and we will be able to get funding and support from them primarily to help us with our trade business, etc.,” Aurangzeb said during an interview with Pakistan’s Geo TV on Wednesday night.
Pakistan has been financially assisted by countries like Saudi Arabia and the United Arab Emirates in the past, with deposits of billions of dollars in its central bank, followed by rollovers.
Gulf states have also regularly provided Pakistan oil on deferred payment facilities and offered direct financial support to help stabilize its economy and shore up its foreign exchange reserves.
Pakistan’s newly appointed finance minister has said he wants to ensure macroeconomic stability and reduce spending and tax system leakages as an IMF team arrived in Islamabad to hold a second and last review of the nation’s $3 billion stand-by arrangement starting today, Thursday.
A set of critical challenges face Aurangzeb, including stabilizing the economy amid soaring inflation and dwindling foreign reserves, managing substantial external debts and navigating negotiations with global lenders. Pakistan also needs fiscal reforms to boost revenue and attract investments, vital for sustainable economic growth and job creation.
The debt-ridden economy, which shrank 0.2 percent last year and is expected to grow around 2 percent this year, has been under extreme stress with low reserves, a balance of payment crisis, inflation at 23 percent, policy interest rates at 22 percent and record local currency depreciation.
“The GDP is better, we have macroeconomic stability and the exchange rate is getting better,” Aurangzeb told Geo. “So we need to bring this macro stability to permanence. If this stability comes toward permeance, we can lead it toward growth.”
The minister said Pakistan had a narrow tax base and needed to reduce revenue leakages, for which it was important to digitize the tax system and make it more transparent.
“This is something we have already started working on,” said the minister, who made his first official visit to the Federal Bureau of Revenue, the national tax collection body, on Wednesday.
On foreign borrowing, the minister said Pakistan needed to improve its economic management to break out of the practice of asking friendly countries to deposit money in its central bank and then seeking rollovers.
“Now even these friendly countries have given us a clear hint that they want to help us but not through aid but through investments,” the finance minister added. “And I think it is the right thing to do for the country.”
Aurangzeb said the government would tap the China bond market in the next fiscal year.
“The one [bond] market that we haven’t tapped is in China,” he said.
“See, our G2G [government-to-government] relationships are good. Their banks are still rolling over and giving aid to us. Chinese government is also helping us.”
“So, the panda market there, the bond market, it’s the second or third most liquid market in the world,” he added. “So I think from the ministry of finance we should go toward inaugural panda bonds during the next fiscal year.”
In February, China rolled over a $2 billion loan to Pakistan due in March.
The lender has said it will formulate a medium-term program if Islamabad applies for one.
Ahead of the current stand-by arrangement, Pakistan had to meet IMF conditions including revising its budget, and raising interest rates and the price of electricity and gas. The IMF also got Pakistan to raise $1.34 billion in new taxes. The measures fueled all-time high inflation of 38 percent year-on-year in May.
The government has not officially stated the size of the additional funding it is seeking through a successor program, but Bloomberg reported in February that Pakistan planned to seek a new loan of at least $6 billion from the lender.
Pakistan says will seek financing from Middle Eastern banks after securing new IMF bailout
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Pakistan says will seek financing from Middle Eastern banks after securing new IMF bailout
- New finance chief hopes better credit ratings post-bailout will make tapping bond markets easier
- Pakistan aims to secure new IMF loan after successful completion of last review under $3 billion facility
Pakistan president urges settlement of Azad Kashmir price hike issue through ‘dialogue’
- The remarks came during President Asif Ali Zardari’s meeting with members of the Azad Kashmir Legislative Assembly
- On Saturday, clashes erupted in the territory between police and protesters demanding cheaper wheat flour, electricity
ISLAMABAD: President Asif Ali Zardari on Sunday urged all stakeholders to exercise restraint and resolve the price hike issue in Azad Kashmir through “dialogue and mutual consultation,” Pakistani state media reported, amid protests in the territory for subsidized wheat flour and cheaper electricity.
The Pakistan president said this during his meeting with a delegation of members of the Azad Jammu and Kashmir (AJK) Legislative Assembly, who belonged to the Pakistan Peoples Party (PPP), in the Pakistani capital of Islamabad.
The statement came a day after clashes erupted between police and supporters of the Jammu Kashmir Joint Awami Action Committee (JAAC) in various parts of the territory, resulting in the killing of a police officer and injuries to 90 others on both sides, according to officials.
The protests turned violent when police attempted to stop a rally headed for Azad Kashmir’s capital of Muzaffarabad from Kotli and Poonch districts. The protesters are demanding electricity as per hydropower generation cost in Azad Kashmir, subsidized wheat flour, and an end to privileges enjoyed by the elite.
“The President said political parties, state institutions and the people of AJK should act responsibly so that hostile elements could not exploit the situation to their benefit,” the Radio Pakistan broadcaster reported.
“The President highlighted that the demands of the people of AJK should be addressed as per law. He said that he would take up the grievances of the people of AJK with Prime Minister Shehbaz Sharif to find a way out of the current situation.”
The Himalayan territory of Kashmir has been divided between India and Pakistan since their independence from Britain in 1947. Both countries rule part of the territory, but claim it in full and have fought three wars over the disputed region.
Sharif earlier said peaceful protests were a democratic right, but there should be “no tolerance” for violence, adding that he was “deeply concerned” over the situation in Azad Kashmir.
“Unfortunately, in situations of chaos and dissent there are always some who rush in to score political points,” he said on X. “While debate, discussion and peaceful protests are the beauties of democracy, there should be absolutely no tolerance for taking the law in one’s own hands and damaging government properties.”
The western portion of the larger Kashmir region is administered by Pakistan as a nominally self-governing entity, where the protesters have been calling for subsidy on wheat flour and electricity among other demands.
Pakistan last year narrowly avoided a default on the payment of foreign debts when the International Monetary Fund and several friendly nations came to its rescue by giving it loans.
Pakistan’s monthly inflation rate at one point reached over 40 percent, but authorities say it has come down to 17 percent ahead of talks with the IMF for a new bailout. Islamabad plans to get at least $6 billion from the lender when it reaches a deal expected in the coming months.
Pakistan defeat Ireland to level T20 series
- Ireland made a dynamic start after being put into bat as the hosts blasted 29 runs in the first three overs
- But Shaheen Shah Afridi put the brakes on Ireland’s assault, dismissing the opening pair in the fourth over
LONDON: Pakistan beat Ireland by seven wickets in the second Twenty20 international in Dublin on Sunday to set up a deciding showdown in the three-match series.
Ireland made a dynamic start after being put into bat as the hosts blasted 29 runs in the first three overs.
But Shaheen Shah Afridi put the brakes on Ireland’s assault, dismissing opening pair Paul Stirling and Andrew Balbirnie in the fourth over.
Lorcan Tucker and Harry Tector (32) put on 62 for the third wicket, with the former scoring 51 in 34 deliveries.
Curtis Campher (22) and George Dockrell (15) boosted the score before Gareth Delany’s 28 off 10 balls helped the hosts post 193 for seven.
Pakistan spluttered at the start of their chase as Saim Ayub was caught in the first over and skipper Babar Azam nicked Graham Hume behind to depart for a duck in the second.
But Ireland’s hopes of sealing a famous series win with a game to spare were dashed as Mohammad Rizwan (75 not out) and Fakhar Zaman (78) put on a stunning 140-run partnership.
Azam Khan added 30 from 10 balls to take Pakistan home with 3.1 overs unused.
Ireland had claimed their first ever T20 victory against Pakistan in the series opener on Friday, winning by five wickets with one ball to spare.
Pakistan will also face Ireland in the group stage of next month’s T20 World Cup in the United States and the West Indies.
Former Pakistan finance minister announces forming new party ending months of speculation
- Miftah Ismail, who took tough decisions for resumption of Pakistan’s stalled $6 billion IMF bailout, was forced to step down in 2022
- Former minister says they are forming a party based on ‘ideas and not personalities,’ with women and young people as part of leadership
ISLAMABAD: Former Pakistan finance minister, Miftah Ismail, on Sunday announced forming a new political party that would be “internally democratic” and would speak for the “aspirations of all Pakistanis.”
Ismail, who took tough decisions for the resumption of the country’s stalled $6 billion International Monetary Fund (IMF) bailout, was forced to step down in September 2022 by the former coalition government of Prime Minister Shehbaz Sharif and with Ishaq Dar.
The former minister, along with other dissident politicians belonging to the then ruling coalition, kicked off a nationwide debate called “Reimagining Pakistan” in 2023, taking up a wide range of issues for discussion while expressing regret they were not adequately addressed earlier.
For the last several months, speculation had been rife that the former finance minister was planning to launch a new political group, which could be joined by former prime minister Shahid Khaqan Abbasi and ex-senator Mustafa Nawaz Khokar.
On Sunday, Ismail said they were forming a party based on “ideas and not personalities,” with women and young people as part of the leadership team.
“We are forming a different kind of party... a party that has professionals of integrity, competence and intellectual honesty, a party that belongs not to a province or a city but to the whole nation, a party that will constitutionally mandate term limits for its leaders, be internally democratic, and would never consider any individual or family to be indispensable,” he said on X.
“Most importantly, a party that speaks for the hopes and aspirations of all Pakistanis.”
In an op-ed written for the English-language daily The News on Saturday, Ismail said for the first time ever, they were not just apprehensive but frightened about the future of Pakistan.
“Daily survival is getting harder and harder for our people, our already ineffective governance is getting even worse, and our nation is drifting backward as the rest of the world is marching forward,” he wrote.
“We are fast reaching the point of no return – and it is imperative we take a hard look at our ineffective governance that has failed our people. We need to radically restructure our governance so that we can finally give hope and opportunity to all our people.”
Pakistan has for months been faced with low foreign exchange reserves, currency devaluation and high inflation. The South Asian country last month completed a short-term $3 billion International Monetary Fund (IMF) program, which helped stave off a sovereign default, but the incumbent government of PM Shehbaz Sharif has stressed the need for a fresh, longer-term program.
Pakistan and the IMF are expected to begin formal talks next week, with Islamabad saying it expects a staff-level agreement by July. Though both Pakistani and IMF officials have refrained from commenting on the size of the program, the South Asian nation is expected to seek around $7 billion bailout from the global lender.
PM announces Rs1 mln for each player as Pakistan hockey team returns home to hero’s welcome
- Pakistan on Saturday won the silver medal after reaching the Azlan Shah Hockey Cup final in Malaysia
- The feat has rekindled hopes of Pakistan hockey renaissance after decades of dormancy in national game
ISLAMABAD: Prime Minister Shehbaz Sharif has announced Rs1 million ($3,599) for each member of the Pakistan hockey team that clinched the silver medal in the Azlan Shah Hockey Cup in Malaysia.
The announcement came shortly after the Pakistan team arrived in the eastern city of Lahore to a hero’s welcome on Sunday, where they were welcomed by Rana Mashhood, chairman of chairman of PM’s Youth Program, and hundreds of jubilant Pakistanis.
Japan defeated Pakistan in a penalty shootout after a tense 2-2 draw in Ipoh on Saturday in a dramatic conclusion to the 2024 Azlan Shah Hockey Cup final. Pakistan reached the tournament’s final for the first time since 2011 following a series of stellar performances.
In a post on Facebook, the Pakistan Hockey Federation (PHF) thanked PM Sharif for his generous support and encouragement toward the national heroes.
“Thanks to the PM’s announcement of 18 million PKR (1 million cash for each player), for our Silver medalist Pakistan Hockey Team at the Sultan Azlan Shah Cup feels honored and appreciated for their hard work and dedication,” the PHF said.
“This gesture not only acknowledges their exceptional performance but also serves as a motivating force for them to continue striving for excellence on the international stage!“
Six teams participated in the event, including the tournament Malaysia, Pakistan, South Korea, Japan, New Zealand and Canada.
Pakistan have won the Azlan Shah Cup title three times in the past and stood the second runners-up in the last edition that was also held in Malaysia two years ago.
Pakistan’s feat at the Azlan Shah Cup has rekindled hopes of a hockey renaissance after decades of dormancy in the national game.
Pakistan PM says ‘no tolerance’ for violence amid Azad Kashmir protests over price hikes
- Clashes erupted in parts of Azad Kashmir Saturday as protesters demanded cheaper wheat flour, electricity
- The violence resulted in the killing of a police officer and injuries to 90 others on both sides, officials say
ISLAMABAD: Pakistan Prime Minister Shehbaz Sharif said on Sunday peaceful protests were a democratic right, but there should be “no tolerance” for violence, amid protests in Azad Kashmir for subsidized wheat flour and cheaper electricity.
The statement came a day after clashes erupted between police and supporters of the Jammu Kashmir Joint Awami Action Committee (JAAC) in various parts of the territory, resulting in the killing of a police officer and injuries to 90 others on both sides, according to officials.
The protests turned violent when police attempted to stop a rally headed for the Azad Kashmir capital of Muzaffarabad from Kotli and Poonch districts. The protesters are demanding electricity as per hydropower generation cost in Azad Kashmir, subsidized wheat flour, and an end to privileges enjoyed by the elite.
In his message on X, PM Sharif said he was “deeply concerned” over the situation in Azad Jammu and Kashmir (AJK) and had asked AJK PM Anwar-ul-Haq to hold talks with the protesters.
“Unfortunately, in situations of chaos and dissent there are always some who rush in to score political points,” he said. “While debate, discussion and peaceful protests are the beauties of democracy, there should be absolutely no tolerance for taking the law in one’s own hands and damaging government properties.”
Sharif urged all parties to resort to peaceful course of action for the resolution of their demands. “Despite best efforts of detractors, the matter will hopefully be settled soon,” he said.
Separately, the Azad Kashmir government on Sunday invited protesters for talks.
“The situation is currently peaceful and under control, and we are trying to settle issues through talks,” Abdul Majid Khan, a spokesperson of the Azad Kashmir government who is also its finance minister, told Arab News.
“We have invited the action committee to come and sit with us for dialogue on all their demands.”
Khan warned that no one would be allowed to take the law into their hands, emphasizing the government had exercised “significant restraint.”
He noted the government was providing wheat in Azad Kashmir at Rs3,100 [$11.16] per 40kg, which was already heavily subsidized and cheaper than in Pakistan’s most populous Punjab province, the main producer of the crop in the South Asian country.
The Himalayan territory of Kashmir has been divided between India and Pakistan since their independence from Britain in 1947. Both countries rule part of the territory, but claim it in full and have fought three wars over the disputed region.
The western portion of the larger Kashmir region is administered by Pakistan as a nominally self-governing entity.
Pakistan last year narrowly avoided a default on the payment of foreign debts when the International Monetary Fund and several friendly nations came to its rescue by giving it loans.
Pakistan’s monthly inflation rate at one point reached over 40 percent, but authorities say it had come down to 17 percent ahead of talks with the IMF for a new bailout. Islamabad plans to get at least $6 billion from the lender when it reaches a deal expected in the coming months.
