Pakistan is seeking around $1 billion in funding from the IMF to manage external shocks, as confirmed by Finance Minister Muhammad Aurangzeb at the IMF/World Bank meetings in Washington. The country is also in talks for a credit enhancement with the Asian Infrastructure Investment Bank for a Panda bond issue.
Privatisation and Financial Stability
Aurangzeb aims to finalize the privatization of PIA and outsourcing of Islamabad’s airport by November after facing delays for macroeconomic stability and due diligence. Pakistan faced default last year but has made progress with inflation dropping and securing a $7 billion IMF loan last month.
Challenges and Reforms
The IMF deal requires improving tax base, SOE privatization, and power sector reforms. Aurangzeb highlighted the need to address corruption and leakage in these sectors while increasing tax compliance in the country.