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Pakistan considers seeking emergency loan from IMF for floods

Pakistan is considering seeking an emergency loan from the International Monetary Fund (IMF) to counter the devastation due to floods.

According to a local media report, Finance Minister Miftah Ismail has informed Prime Minister Shehbaz Sharif that reaching out to the IMF for emergency relief package was under the Finance Ministry’s consideration.

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Miftah had also raised this issue in a high-level meeting related to floods that was attended by Chief of Army Staff (COAS) General Qamar javed Bajwa.

According to the report, Miftah has also said that at the initial stage, no decision to approach IMF was made.

Dr. Aisha Pasha, Minister of State for Finance, has been quoted as saying that the government would decide upon approaching bilateral and multilateral creditors for financial assistance once the quantum of losses was gauged.

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Finance Ministry’s initial assessment has showed that the current flood devastation might have caused up to Rs2.5 trillion losses. According to the ministry, during the ongoing fiscal year, the growth rate might slow down to just two percent.

Supply chain disruptions could raise the inflation to 26 percent against the projected inflation of State Bank of Pakistan (SBP) and the IMF ranging between 18 percent and 20 percent.

According to media reports, the Ministry of Finance has made the initial assessment of the losses caused to the economy but the numbers are subject to change.

Asian Development Bank’s (ADB) President Masatsuga Asakawa has said that his thoughts were with the flood victims and families as extremely disturbing news was coming from Pakistan.

Asakawa, while assuring continuation of support to mitigate the impact of the climate crisis, said that ADB stood with affected Pakistanis.

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