Earlier, media reports had indicated that Pakistan was reportedly seeking $8 billion loan package, the largest ever, from the IMF to cope with its balance of payment crisis, falling foreign exchange reserves and prop up its struggling currency. The latest media report says that Pakistan is seeking a bailout of $15 billion from the International Monetary Fund (IMF), nearly double of what has been reported so far, due to $5 billion roll-over debt and maturity of $1 billion sukuk in March next year. Analysts believe a complete roll-over of the short-term debt, exceeding $5 billion per year. The sukuk, worth $1 billion, maturing in March 2019, may be covered by new issuance of the same size. An IMF program would also mobilize additional financing from multilateral institutions and bilateral creditors. Christine Lagarde, managing director, IMF, has confirmed that Pakistan has requested the loans after meeting with Finance Minister Asad Umar in Indonesia, without saying how much the Pakistanis had asked for. Analysts say with the above assumptions, we expect an agreement on a three-year IMF program by end of this year for $15 billion. Such a package would be enough to increase the official reserves to an adequate level of at least three months of imports. They note that the current account deficit has widened from 1.7 per cent of GDP in 2016 to 5.8 per cent in 2018. They expect the current account deficit to narrow to 5.4 per cent of GDP this year and 4.2 per cent next year, supported by a significant improvement in exports from the more competitive exchange rate and a moderation in growth of imports from the China-Pakistan Economic Corridor [CPEC] projects. The Saudi-backed Islamic Development Bank has made an offer of $4 billion in loans to be disbursed over the three-year period. The US has held Pakistan’s burden of Chinese debt as one of the reasons responsible for the country’s economic woes and its subsequent bailout request to the IMF. Finance Minister Asad Umar has rebutted this narrative of the Trump administration. Washington’s apprehension that Chinese loans have damaged Pakistan’s economy continues even though Pakistan has made clear that CPEC repayments will not begin till 2021. We think in the interest of transparency it will be nice to discuss the whole subject in Parliament before moving ahead? Mr. Asad Umar himself promised to open CPEC books in the House? Why should there be an aspect of mystery regarding a game-changer that will improve our infrastructure and put us in the defining moment of the region’s revived trade? PTI fittingly attacked PML-N economic policies and international deals that were kept from the public eye as undemocratic. Now it must set a healthy example itself.
Before moving ahead government should discuss economic policies and international deals in Parliament.