Finance Minister Ishaq Dar on Twitter announced that the United Arab Emirates has confirmed with the International Monetary Fund (IMF) for their bilateral support of $1 billion funds to Pakistan.
“State Bank of Pakistan is now engaged for needful documentation for taking the said deposit from UAE authorities,” he added.
This comes after Dar last week canceled his trip to Washington for the IMF-World Bank meetings in order to avoid raising expectations for debt relief in the coming days. His tweet suggests there’s new cash coming into Pakistan in the coming few weeks.
Meanwhile, Pakistan’s debt remains sustainable, said the IMF’s managing director Kristalina Georgieva at a news briefing in Washington on Thursday, after the government reiterated that it had met all requirements to receive a critical bailout from the IMF.
Pakistan has less than a month’s worth of foreign exchange reserves and is awaiting a $1.1 billion bailout package from the IMF, which has been delayed since November due to fiscal policy issues.
To unlock the next tranche of IMF funding, Pakistan must provide assurance that its balance of payments deficit is fully funded for the fiscal year ending in June. Besides the UAE funds, Pakistan expects to generate external financing sources from Saudi Arabia, Qatar, and some prominent multilateral lending institutions other than the IMF.
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