The Pakistan Tehreek-e-Insaf (PTI) has addressed a letter to the International Monetary Fund (IMF), raising concerns about the potential challenges facing Pakistan and seeking further clarification on the restructuring of the national carrier, Pakistan International Airlines (PIA), and its associated loans amounting to 268 billion rupees.
According to the details provided, the decision made by the PTI could lead to adverse effects on the economy due to the demand for halting support to Pakistan, citing alleged electoral irregularities. This decision, coupled with dwindling reserves, could have far-reaching implications for the economy.
On the other hand, the IMF has requested additional clarification from the government of Pakistan regarding the approved restructuring plan for PIA and its unbundling. This request aims to understand how the rescheduling of 268 billion rupees in domestic loans will impact the financial landscape and how the government plans to manage the financial losses without exacerbating them.
It has been emphasized that before the IMF can engage in formal discussions with the government, further elucidation is required. This signifies the importance of a comprehensive response from the Pakistani authorities to address the concerns raised by the IMF.
The statement from the PTI comes at a crucial juncture, as the incoming government, possibly to be sworn in by the first week of March 2024, will be faced with the challenge of fulfilling the existing $3 billion Stand-By Arrangement (SBA) program, completing the Belt and Road Initiative (BRI) projects, and filling the dollar deficit. The PTI’s letter underscores the urgency of addressing these issues and highlights the necessity for swift action to stabilize Pakistan’s economy.
The upcoming government will need to swiftly assume power and immediately submit a formal request to the IMF, facilitating a comprehensive review by its Islamabad team, ideally completed by March 15, 2024, to secure approval from the board for the final installment of $1.1 billion by April 12, 2024.
