Ishaq Dar hopes for life without IMF as bailout stalled

Irked by the months-long delay in the revival of the International Monetary Fund (IMF) programme, Finance Minister Ishaq Dar on Friday said that Pakistan must end its dependency on the Washington-based lender.

The cash-strapped nation has been negotiating with the IMF since late January for the release of $1.1 billion from a $6.5 billion bailout package agreed upon in 2019. To unlock the funding, the government has cut back on subsidies, removed an artificial cap on the exchange rate, added taxes and raised fuel prices.

Dar, who replaced Miftah Ismail in September last year, had reversed his take regarding the IMF when he came across the severity of the cash-strapped nation reeling with the effects of shrinking foreign exchange reserves and an increased balance of payment crisis.

“We need to learn to live without IMF,” he said during an event organised by the business community in Islamabad, adding that all the prerequisite measures have been taken and an agreement with the lender would be reached soon.

The finance czar assured the business community that Pakistan will soon reach a staff-level agreement with the IMF as the country of 220 million people has completed all prior conditions laid forth by the Fund.

The IMF funding is critical for Pakistan to unlock other external financing avenues to avert a default on its obligations.

As IMF continues to evaluate commitments made by several friendly countries to help Pakistan, a threat of default looms over the country.

“Pakistan has neither defaulted in the past nor will it default in the future,” Dar boosted, claiming that the country wasn’t founded to default.

The finance minister said the "downfall" has stopped and will be reversed soon, claiming that the country would witness development and the government would also control the deficit.

"It is a surprise for the international community that Pakistan did not witness a similar situation to Sri Lanka," he said, stressing that the $350 billion economy would not default.