ISLAMABAD: The acting governor of Pakistan’s central bank, Dr. Murtaza Syed, said on Sunday the country would soon bridge the external financing gap of $4 billion with the help of friendly nations, reported the local media.
Faced with a rising current account deficit and depleting forex reserves, Pakistan has been striving to revive an International Monetary Fund (IMF) loan facility amounting to $6 billion which was stalled earlier this year after the previous administration of ousted prime minister Imran Khan went against its terms and conditions by subsidizing fuel and energy prices.
Pakistan also reached a staff-level agreement with the international lender on July 13 to resume the loan program. However, the IMF board is tentatively scheduled to hold a meeting to approve it after the country manages to get adequate financing assurances from other sources to meet its external financial obligations.
“Pakistan has already managed gross external financing requirements of $34 to $35 billion, but in addition, Islamabad is making efforts to get confirmation of $4 billion inflows from friendly countries such as Saudi Arabia, the UAE, and Qatar,” The News quoted the acting governor of the State Bank of Pakistan (SBP) as saying after conducting an exclusive interview with him.
“These additional dollar inflows will be materialized for increasing foreign currency reserves position to create a buffer in case of a crisis-like situation,” he added.
Pakistan wants the IMF to resume the loan program, hoping it will help unlock other sources of international finances.
The country has raised energy and fuel prices in recent months to implement stringent reforms recommended by the global lender to secure the next tranche of $1.2 billion under the loan program.
The acting SBP governor did not share any timeframe for bridging the financing gap, though he maintained it would soon be managed.
“He contended that both the government and IMF high-ups were making efforts to get confirmation from respective countries and it would be done very soon,” The News said in its report.
The country’s finance minister Miftah Ismail has also requested the IMF to expand the size of the loan program to $8 billion and increase its tenure to June 2023.
