ISLAMABAD: Pakistan’s Finance Minister Miftah Ismail on Tuesday said the cash-strapped South Asian country was not going to default on international loans, hoping for an increase in dollar inflows in the next few weeks. 

The statement came more than a week after Pakistan and the International Monetary Fund (IMF) reached a staff-level agreement for the disbursement of $1.17 billion after approval from the IMF board. 

Pakistan has been struggling to keep its economy afloat as the country’s foreign exchange reserves have diminished to $9.32 billion — barely enough to cover 45 days of imports — while the local currency has hit record lows against the greenback. 

“I know we are not going to default, governor state bank knows we are not going to default, Prime Minister knows we are not going to default,” Ismail said in a live discussion with Tabadlab, a local think tank, on Tuesday. 

“Not just that we have inside information, but that we know that all balls we have are in air, so we are not going to default.”

Ismail said his ministry was trying to do moderate purchases for two three months to improve the balance-of-payment situation. 

“In couple of weeks, you will see that inflow of dollars to Pakistan will be more than the outflow,” he said. “Once that happens, the pressure on rupee will vanish.” 

The Pakistani currency on Tuesday hit another all-time low of Rs232.93 against the US dollar as the demand for import payments kept the rupee under pressure. 

Without naming any country, Ismail said he had requested a friendly state for foreign exchange deposits but the request was turned down. 

“I had asked a friendly currently for deposits and they said ‘we don’t do deposits anymore because you guys never return deposits’,” he told Tabadlab. 

“They said we will invest in your stock market in shares owned by the government.” 

The finance minister, however, said there was no provision in Pakistan for the government to sell off its shares to any other government. “Now, hopefully, we will have a law or an ordinance,” he added. 

Ismail said the country’s central bank would soon have a new governor as the appointment process began today, Tuesday, and was expected to be finalized by Wednesday. 

Dr. Murtaza Syed, a deputy governor of the central bank, has been working as the acting governor since Dr. Reza Baqir completed his three-year term on May 4.