According to Reuters, finance minister Ishaq Dar plans to restructure $27 billion in non-Paris Club debt. It should be noted, however, that haircuts will not be pursued.
Pakistan’s current IMF programme will not be renegotiated or default on its debt ruled out by Dar.
After devastating floods, Pakistan needs about $32bn in external financing, estimated at multilateral development banks and international donors.
Funds may be reallocated from previously approved, slower-disbursing development loans.
Pakistan will seek restructuring on equal terms for all bilateral creditors, Dar says at the IMF and World Bank annual meetings.
If asked whether he thought it would be difficult to persuade China, which owes about $23bn, he declined to comment.
However, when asked whether Pakistan would seek a haircut on its debt, he replied “rescheduling is fine.”. It does not seem fair to ask Pakistan for a haircut on its debt.
Defend the rupee
He is a staunch supporter of the rupee, having served as finance minister three times.
Since his appointment, the currency has rallied some 10%, despite being battered by a strong US dollar this year.
According to Dar, the rupee’s “true value” is under 200 to the dollar. The price of the stock was 219 at the time of last trading.
” I want a stable currency, and I want a realistic interest rate. I support market-based, but not subject to a currency being held hostage and making billions for speculators.”
Optional borrowing
“I have discussed all options,” Dar said when asked if the IMF’s Resilience and Sustainability Trust was an option.
Due to devastating floods, the country has lost crops and may need to import half a million tons of wheat next year.
It is possible for us to approach and access this facility in this scenario.
He also met with representatives of the IMF, World Bank, Saudi Arabia, the United Kingdom, and the United States separately.
Nigel Casey led a delegation to the World Bank’s high-level flood discussion led by Martin Raiser.
At the round table, all major bilateral and multilateral development partners and donors participated. Post-disaster needs assessment was prepared by World Bank, Asian Development Bank, UNDP, EU and Government of Pakistan.
According to a press release, Pakistan needs adequate support to meet its recovery and rehabilitation challenges.
Dar also met with Jihad Azour, Director of the Middle East and Central Asia Department at the IMF. Azour, on the other hand, was confident that the fund would be able to support the finance minister.
Donald Lu and Ramin Toloui expressed US solidarity with Pakistan during their visit to the Pakistan Embassy.
According to the press release, the finance ministry also discussed other mutual interests.
Ishaq Dar meeting with Sultan Abdul Rehman Al Murshid
In his meeting with Sultan Abdul Rehman Al Murshid, Dar expressed Pakistan’s “deep gratitude” for Saudi Arabia’s support. Dar was assured that the SFD will continue to support him as long as he needs it.
Dar also met with UK Minister of State for Development Vicky Ford and thanked her country for its support.
Also, the finance minister appreciated the DCTS Scheme’s trade concessions for Pakistan.
According to the finance ministry, both sides discussed ways to enhance bilateral development cooperation.
