Pakistan to seek IMF bailout despite USD 6 billion Saudi rescue

Pakistan has not dropped the idea of seeking assistance from the International Monetary Fund (IMF) despite Saudi Arabia offering USD 6 billion aid package to mitigate pressure on the cash-strapped country's foreign exchange reserves, officials said on Wednesday.

Prime Minister Imran Khan earlier this month gave green signal to Finance Minister Asad Umar to seek the IMF bailout after an initial failure to secure much-needed assistance from "friendly countries".

But the situation changed when Khan on Monday dashed to Riyadh to attend a Saudi-sponsored international investment economic forum despite its boycott by the European and American investors in the wake of the murder of journalist Jamal Khashoggi.

Khan's meeting with Saudi King Salman and his powerful Crown Prince Mohammad bin Salman resulted in the singing of agreement to provide Pakistan USD 3 billion to support the balance of payment and give oil worth USD 3 billion on deferred payments.

As the stock market showed bullish sentiment and rupee gained against the dollar, questions were raised if Pakistan still needs the IMF package.

Sources in the finance ministry told PTI that Pakistan needed about USD 10 billion in the current fiscal year to support its imports and paying foreign debts.

"The idea of seeking IMF support is still on the table and negotiations will be held in the first week of November," they said.

But they said that Pakistan's bargaining position was strengthened after the Saudi commitments.

The sources also said that Prime Minister Khan would visit China from November 3 and it was possible to get financial assistance to further decrease reliance on IMF bailout.

Earlier, officials said that Pakistan would seek around USD 8 billion from the IMF which would be the biggest package by the Fund for Islamabad.