Pakistan to seek International Monetary Fund bailout despite $6b Saudi rescue

Daniel Fowler
October 24, 2018

The KSE-100 index surged by 1103.02 points to 38,817.92 points on news that Saudi Arabia would be providing $3 billion deposit to avert a balance of payment crisis and $3 billion of oil on deferred payments for a period of three years.

Imran will attend and address a session titled, "Pakistan, a hub of regional development and stability". "This arrangement will be in place for three years, which will be reviewed thereafter", Geo News quoted the statement as saying.

Pakistan's Foreign Ministry on Tuesday night said the latest visit had met with success.

Pakistani analysts say reducing the size of the bailout package needed from the IMF would shore up Pakistan's weak position during negotiations with the fund.

Khan has also faced criticism at home for attending the Future Investment Initiative in Riyadh this week after it emerged that Jamal Khashoggi, a prominent Saudi critic, was killed inside the kingdom's consulate in Istanbul this month.

Pakistan has a close economic and strategic relationship with Saudi Arabia, which is home to at least 1.9 million Pakistani expatriate workers.

Khan is scheduled to visit China next week.

The prime minister is accompanied by Foreign Minister Shah Mehmood Qureshi, Finance Minister Asad Umar, Information Minister Fawad Chaudhry, and Adviser to Prime Minister on Commerce and Industry Abdul Razzak Dawood.

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Officials told The Nation that Imran Khan was keeping the IMF as the last option and would try to acquire minimum loan from the Fund if 'inevitable'.

Before departing for Riyadh, Khan had said his country is "desperate" to shore up its foreign currency reserves, which are at a four-year low of $8.4m. Saudi Arabia confirmed its interest in this project, and an MoU will be signed after obtaining cabinet approval. For this objective, the federal government and the government of Balochistan will consult, following which a delegation of Saudi Arabia will be invited to visit Pakistan.

On October 22, the prime minister had arrived in Madina, where he was received by Governor Prince Faisal bin Salman.

The government will clamp down on money launderers and create opportunities for investment, Khan added.

Prime Minister Khan said he would try once again following the conclusion of the general elections in India.

Pakistani Prime Minister Imran Khan Tuesday vowed to hold peace talks with arch-rival India following elections in the neighboring country, after a similar offer from the former cricketer was "rebuffed".

Far-reaching decisions on bilateral economic and financial cooperation were also agreed during the meetings with Saudi leadership, the statement said.

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