Washington, Nov 17 : In the wake of the ongoing recession and economy collapse, Pakistan is learnt to have turned to Britain and 11 other "Friends of Democratic Pakistan" for help to save itself from financial crisis and military defeat by Islamist insurgents, said a report in timesonline.com
According to the report, Pakistani officials are in Abu Dhabi today to ask for billions of dollars from "Friends of Democratic Pakistan". The meeting comes just two days after Pakistan agreed to a loan of 7.6 billion dollars from the International Monetary Fund (IMF).
The likely outcome of the meeting is that the Friends will agree to help Pakistan secure more funds from international agencies such as the Asian Development Bank. To do that, however, Pakistan will have to abide by unpopular IMF conditions, which could precipitate another political crisis. Already the Government is under fire for failing to curb its own profligacy or clarify what strings are attached to the IMF loan.
Pakistani officials say they were over the worst of a crisis that had brought them within days of defaulting on foreign debt repayments, and which had threatened to derail a military campaign against Taleban and al-Qaeda militants on the Afghan border. "We have fulfilled our commitment that Pakistan will never default," the report quoted Shaukat Tareen, finance adviser to Pakistan's Prime Minister, as saying.
Pakistan's foreign exchange reserves have now plummeted to less than 7 billion dollars, enough to pay for just two months of imports. Its Rupee has slumped by one-fifth this year, the stock market by more than a third, and inflation stands staring at 25 per cent.
Rich Pakistanis have exacerbated the crisis by illegally transferring an estimated billion dollars overseas in the past year.
Pakistani officials, who have emphasised the economic cost of supporting the War on Terror in recent days, say that they expect good news from the meeting with "Friends", now that the IMF loan has been agreed upon.
The "Friends", however, are playing down expectations - not least because of their own pressing financial woes, said the report. "Most people are pretty adamant it's not going to be another donors' conference. It's there to support the democratic process in Pakistan," it quoted a Western official as saying.