Finance Minister Miftah Ismail said on Friday that International Monetary Fund (IMF) Managing Director Kristalina Georgieva has “expressed agreement” with Pakistan’s request to alter the terms of the Extended Fund Facility (EEF) programme. It may relax its programme terms for Pakistan in the aftermath of major flood destruction, with new estimates putting losses at $30 billion.
Read more: How the floods caused heavy damages to Pakistan
“They (IMF officials) comprehended our perspective and almost agreed, but formal conversations will occur when I go to Washington in two weeks.” “The requirements will be modified in light of the situation, and the tranche amount will be enhanced,” the finance minister stated.
He also stated that he met with World Bank officials and that the country will get $2 billion from it this year.
“If Sindh’s entire cotton [crop] is destroyed as a result of the floods, we will have to import cotton.” Similarly, if we are unable to seed wheat at the appropriate time, wheat [production] will be diminished. Should we abandon our people? “We’ll have to import that also,” he explained.
He stated that he met with billionaire philanthropist Bill Gates to “discuss milk and other things,” while Prime Minister Shehbaz Sharif discussed meals for children with Saudi Crown Prince Mohammad bin Salman.
When queried about the rupee’s steep depreciation against the dollar, Ismail stated that the government was unable to intervene in the market due to IMF constraints and a lack of dollars. “The dollar is gaining ground versus all currencies.” The impression of default in Pakistan has grown, but we will not default. Therefore, the dollar has surged, but it will return to normalcy in the next days,” he stated emphatically.
Last month, the IMF’s Executive Board concluded the combined 7th and 8th reviews of a loan facility for Pakistan, allowing the country to receive an immediate disbursement of $1.1 billion.
The executive board also approved Pakistani authorities’ request for waivers of performance standards nonobservance.
Earlier, Miftah stated that despite the floods, Pakistan will “absolutely not” default on its financial obligations, indicating that there will be no significant diversion from policies aimed to stabilize a faltering economy.
Despite the flood calamity, Ismail stated that most stabilization strategies and targets, including increasing depleting foreign exchange reserves, were still on track.