Islamabad: The government has started preparations to enter into a new loan agreement with the International Monetary Fund (IMF) while deciding not to expand the current IMF program.
According to details, the government has initiated preparations to take a new program through direct negotiations, as it will not seek an extension of the current loan program with the IMF, which is set to expire on June 30th.
The Ministry of Finance has started preparations to enter into a new loan agreement with the IMF in August. Special Assistant to the Prime Minister, Tariq Bajwa, and the Finance Secretary are working on the new program.
Sources say that Pakistan needs to make non-resident payments of around $9 to $11 billion by December, while the overall payment in the upcoming budget will be around $22 to $24 billion.
According to sources in the Ministry of Finance, if a new agreement is not reached with the IMF, there will be an increased risk of default by October.
The Ministry of Finance has stated that the new loan agreement will be tougher than the current program, and it will have a bailout program of more than three years with the IMF.
