Islamabad: Pakistan Prime Minister Imran Khan on Wednesday assured the countrymen that his government would seek assistance from both friendly countries and the IMF to overcome the balance of payments crisis.
“We have two options: first, we can go to friendly countries and ask them to bridge this gap; and second, that we go to the IMF,” he said.
“The government has decided to do both,” he said while addressing a ceremony to launch Naya Pakistan Housing Programme, a flagship project of his government to build 5 million houses in five years for low income people.
Khan said he will present a roadmap before the nation listing steps the government will take to stabilise the economy.
He said Pakistan is burdened due to debts incurred by the previous government and his government is constrained to borrow more money to pay back those debts.
“We will get out of this. I will take (the country) out of this,” he added.
Finance Minister Asad Umar on Monday said that Pakistan would approach the IMF for a bailout package of USD 6 to 7 billion to address the mounting balance of payments crisis.
“There has been a lot of noise in the country (after decision to go to IMF) during the last 48 hours as if the sky is going to fall. But we need to do it (go to IMF) before our reforms start yielding results in about six months, Khan said.
He clarified that the government is seeking funds from external sources only for the short term, as the economic reforms and austerity measures initiated by his government “will take six months to show results”.
His government has come under heavy criticism after the decision to seek a bailout package from the IMF as Khan in the past had vowed never to seek such assistance and also attacked previous government for going to IMF for loans.
He said the previous governments had taken loans recklessly, which has resulted in the country’s debt ballooning from Rs 6 trillion to Rs 30 trillion in the past 10 years alone.
He said the previous PML-N government had started its term in 2013 with a USD 3 billion current account deficit, but his government inherited USD 18 billion current account deficit.
Pakistan has availed 12 IMF bailouts since the late 1980s. The last one was in September, 2013 when the IMF approved a USD 6.6 billion loan support to the government’s programme to stabilise its economy and boost growth while expanding its social safety net to protect the poor.