Moody's sees very little chance of Pakistan salvaging IMF deal
Last updated on: 14 June,2023 02:12 pm
Repeats default prediction
SINGAPORE (Web Desk) – Amid a complete stalemate, Moody’s Investors Service noted that Pakistan faced “increasing risks” of not being able to rescue the troubled International Monetary Fund (IMF) programme and could even default, reported Bloomberg – a scenario repeatedly rejected by Finance Minister Ishaq Dar.
“There are increasing risks that Pakistan may be unable to complete the IMF programme that expires at the end of June,” Grace Lim, a Moody’s analyst, said.
Previously in May too, Moody’s had warned that Pakistan could default without the IMF agreement during the next fiscal year.
Read more: Pakistan could default without IMF bailout programme, warns Moody's
“We consider that Pakistan will meet its external payments for the remainder of this fiscal year ending in June,” Grace was quoted as saying.
“However, Pakistan’s financing options beyond June are highly uncertain. Without an IMF programme, Pakistan could default given its very weak reserves.”
The latest prediction about a bleak scenario for Pakistan comes as the IMF isn’t happy with the budget presented for 2023-24 and asking for do more.
Given a harsh set of conditions, Dar had said last week that the IMF should not object to presenting a people-friendly budget. Pakistan had tried its best to fulfil all the IMF conditions, he added.
Separately, he had also said that the government was working on a “Plan B” if the IMF did not release the pending loan.
Read more: Dar says budget growth-oriented, mentions Plan B if no progress made on IMF deal
The finance minister, however, avoided to explain or share any details, saying, “Plan-B is always there”. He stated that the features of the plan could not be talked about in public and again reiterated that Pakistan would not default.