Pakistan: Sharif Requests IMF Release $1.1B Tranche

Facts

• With Pakistan's $6.5B loan program set to expire on June 30, the government of Pakistan has made a plea to the International Monetary Fund (IMF) to release a $1.1B tranche, pending since November last year.¹
• Pakistan's Prime Minister, Shehbaz Sharif, met IMF Managing Director Kristalina Georgieva at the Summit for a New Global Financing summit in Paris, asking the IMF to release bailout funds as soon as possible while noting that the South Asian nation remains committed to fulfilling all requirements.²
• The Paris meeting came a week after the IMF criticized a proposed budget submitted by Pakistan's government. IMF's representative for Pakistan, Esther Perez Ruiz, said at the time that the draft budget failed to enforce a more equitable tax system as pledged in the bailout deal.³
• At the meeting, Sharif outlined the steps the Government has taken for economic growth and stability, adding that the release of funds "would help strengthen Pakistan’s ongoing efforts towards economic stabilization, and bring relief to its people."⁴
• The IMF's criticism could derail the crucial bailout, and the next tranche is vital since it could encourage other financial institutions to help Pakistan — whose economic recovery has been dampened by last summer's severe floods — which could face an economic meltdown without the IMF loan.⁵
• Sharif has been vocal about the IMF's delay even after his government allegedly complied with all the conditions attached to the deal.⁶

Sources: ¹Al Jazeera, ²Zawya, ³Associated Press, ⁴ARY NEWS, ⁵ABC News, and ⁶SFGATE.

Narratives

• Pro-establishment narrative, as provided by Aaj English TV. Pakistan's economy is on the brink. However, the chances of Pakistan meeting the IMF's conditions are low due to the severe political turmoil. The South Asian nation is at risk of defaulting on its debt obligations as its financing options beyond June are highly uncertain.
• Establishment-critical narrative, as provided by DAWN. Pakistan can't let itself be a hostage to the IMF and allow itself to be treated like the West's de-facto colony. The country will execute a contingency plan if the June 30 deadline is met without concessions, which includes working on rescheduling the bilateral external debt of over $27B next month and turning to China to come out of the global lender's clutches.