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IMF postpones the second review of $6 billion bailout package for Pakistan

PTI
Islamabad, Islamabad, PakistanUpdated: Apr 07, 2020, 12:55 PM IST
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File photo of Pakistan PM Imran Khan. Photograph:(AFP)

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Pakistan approached the IMF in August 2018 for a bailout package after Prime Minister Imran Khan's government took over.

The IMF has postponed the second review of its $6 billion bailout package for cash-strapped Pakistan scheduled on Friday, citing a delay by the country in implementing the agreed actions, a media report said on Tuesday.

The International Monetary Fund Executive Board approved a three-year, $6 billion loan package for Pakistan in July last year to rein in mounting debts and stave off a looming balance of payments crisis, in exchange for tough austerity measures.

Pakistan approached the IMF in August 2018 for a bailout package after Prime Minister Imran Khan's government took over.

Despite loans from China, Saudi Arabia and the UAE, Prime Minister Khan's government was forced to turn to the IMF due to mounting economic problems.

The IMF has confirmed the postponing of the second review of the bailout package but says its priority has now shifted to the approval of a rapid financing facility of USD 1.4 billion.

The Ministry of Finance told The Express Tribune that the IMF did not inform it about any delay in the approval of the second review of the 10-month-old loan programme.

In February, Pakistan and the IMF agreed that the fund's executive board would approve the second review for the release of a third loan tranche of USD 450 million on April 10, subject to fulfilling of all the conditions by the Pakistan government.

Sources said the IMF board would not take up Pakistan's request for approval of the second review for the October-December 2019 period under the Extended Fund Facility (EFF) on April 10.