Pak to seek 3.1 billion dollar additional IMF loan

Islamabad, Aug. 7 (ANI): Pakistan Prime Minister Yousuf Raza Gilani's financial adviser Shaukat Tarin has said that Islamabad will approach the International Monetary Fund for an additional loan of 3.1 billion dollars in a bid to avoid a balance of payment problem in the current fiscal.

The IMF board of directors is scheduled to consider Islamabad's request for an additional loan on Friday.

It is likely to release the delayed third tranche of 840 million dollars to reduce pressure on the country's forex reserves and the value of rupee.

The Dawn quoted Tarin, as saying that Pakistan had met all targets in the second quarter of 2008-09 under the Standby Arrangement Facility, which would pave way for the release of the tranche.

"There is no problem which may hinder smooth approval of the loan," he added.

He said the only target which had not been met was that of the Federal Board of Revenue which raised 1,155 billion rupees in 2008-09, against the target of 1,160 billion rupees.

The third tranche was expected to be released by the end of June, but it was delayed due to government's failure to comply with the fund's conditions.

However, pressure on the rupee would increase because of the high oil import bill, particularly of furnace oil for producing electricity to overcome power shortage.

The IMF will review Pakistan's March-June economic indicators performance and measures taken in the budget for 2009-10 before approving release of the tranche.

Pakistan and the IMF reached a 23-month standby loan agreement of 7.6 billion dollar in November 2008 to meet the country's balance of payments difficulties and help stabilise the economy. (ANI)