WASHINGTON: Pakistan intends to stay on track with its International Monetary Fund loan programme but also wants the world body to understand the impact of a catastrophic flood on its economy, says Finance Minister Abdul Hafeez Sheikh. “We want to remain on track with the IMF programme because that is a reform programme that we have ourselves undertaken,” said Mr Sheikh. “At the same time, we want a shared understanding of the emerging situation,” he told journalists outside the IMF on Thursday when asked whether he was seeking a relaxation of the conditions attached to the loan.
A mandatory review of Pakistan’s policies planned for June had been pushed back, blocking a disbursement under the loan that was approved two years ago, as the country failed to contain spending and fell behind schedule for implementing a sales tax.
Pakistan is holding technical talks with the IMF on salvaging the economy and on assessing the economic impact of floods that have displaced millions of people and damaged farmland.
Economists say that widespread devastations require massive external financing to meet basic needs of the flood victims and to save the Pakistani economy from a possible collapse.
The New York Times reported on Friday that the flooding could set Pakistani infrastructure back “years, if not decades, further weaken its feeble civilian administration and add to the burdens on its military” and “distract from American requests for Pakistan to battle Taliban insurgents”.
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