IMF to conduct analysis of Pakistan’s debt sustainability

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Srinagar: The International Monetary Fund (IMF) is planning to conduct a proper analysis of debt sustainability for Pakistan before permitting further loan to the country, a senior official has said, amid concerns that Pakistan is seeking a multibillion-dollar bailout package from the global financial body to pay back Chinese creditors.

Pakistan is seeking USD 8 billion from the IMF to get free from a severe balance-of-payments crisis that can cripple its economy.

A recent meeting between the IMF and Pakistan ended in a stalemate.

Addressing to the media, IMF Director Communications Gerry Rice said that the debt transparency is essential to conduct a proper analysis to check the sustainability of a country’s debt. “That’s what the IMF does when we are going into a programme with our member countries. So that will be the case in Pakistan,” he added on Thursday.

China is making huge infrastructure investments as part of its Belt and Road Initiative (BRI). The BRI’s flagship project is the USD 60 billion China-Pakistan Economic Corridor (CPEC) that is planned to run from northwest China’s Xinjiang province to Gwadar port in Pakistan’s Balochistan province.

There are concerns that given Pakistan’s growing Chinese debt, the same could happen to the Gwadar port and other major CPEC-linked projects in Pakistan.

But China has rejected criticism that the CPEC projects have saddled Pakistan with expensive debt.

Following Pakistan’s request for financial support, IMF team visited Islamabad in November for talks.

“The discussions are active. They continue to work reaching an understanding on the policy priorities and reforms to stabilise the economy, lay the foundations for sustainable and inclusive growth,” he said. (inputs from PTI).

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