Cash-strapped Pakistan on Tuesday moved closer to securing a massive $11 billion economic bailout package from international donor agencies including the IMF, to revive the ailing national economy, media reports said.
After lengthy discussions between finance minister Ishaq Dar and International Monetary Fund (IMF) team led by Jeffery Frank, the two sides have reached closer to finalising $5.4 billion loan package, The Dawn reported.
In addition to the IMF assistance, Pakistan will also get a $5.6 billion loan from the Asian Development Bank and the World Bank as well as countries like Japan, U.S. and U.K..
The agreement with IMF will pave the way for additional money from the donor banks and countries and the “total volume of loan will be $11 billion,” the paper said citing official sources.
Pakistan needs to meet tough conditions of the donor community before the money starts pouring in, including IMF’s demand to reduce fiscal deficit to 4.5 per cent from nearly 8 per cent, increase power tariffs, withdraw subsidies, increase tax base and restart privatisation.
Some of the conditions, if met, will result in price hike and joblessness but the country will have to swallow the bitter pill to kick start the revival of the economy.