Pakistan could default without an International Monetary Fund bailout as its financing options beyond June are uncertain, Moody\u2019s Investor Service said.
\n\u201cWe consider that Pakistan will meet its external payments for the remainder of this fiscal year ending in June,\u201d said Grace Lim, a sovereign analyst with the ratings company in Singapore. \u201cHowever, Pakistan\u2019s financing options beyond June are highly uncertain. Without an IMF program, Pakistan could default given its very weak reserves.\u201d
\nPakistan is struggling to restart a $6.5 billion bailout program from the Washington-based lender, which has stalled after the government failed to meet some loan conditions. Political tensions ahead of elections due this year are adding to the risk of a delay in the loan, as former premier Imran Khan is showing no signs of backing down against the government.
\nDollar bonds due in 2031 were indicated at 34.58 cents on the dollar on Tuesday near the lowest since November. The rupee has been trading near a record low.
\nAn engagement with the IMF beyond June would support additional financing from other multilateral and bilateral partners, which could reduce default risk, Lim said in an emailed response to questions Monday. Pakistan\u2019s foreign-exchange reserves \u2014 which stand at $4.5 billion \u2014 remain extremely low and sufficient to cover only about one month of imports, she said.
\nPakistan\u2019s gross external financing needs as a proportion of current-account receipts plus usable reserves is estimated to rise to 139.5% in fiscal year 2024 from 133% in 2023, according to S&P Global Ratings.
\n\u201cWe consider the IMF program to be a foundation for important fiscal policy reforms,\u201d said Andrew Wood, a sovereign analyst at S&P in Singapore. \u201cAgreement on the current review cycle could also coalesce more confidence for other bilateral and multilateral lenders to Pakistan.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
Pakistan could default without an International Monetary Fund bailout as its financing options beyond June are uncertain, Moody\u2019s Investor Service said. \u201cWe consider that Pakistan…<\/p>\n","protected":false},"author":1,"featured_media":6634,"comment_status":"registered_only","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[16],"tags":[],"class_list":["post-6633","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"aioseo_notices":[],"jetpack_publicize_connections":[],"_links":{"self":[{"href":"https:\/\/www.diplomacypakistan.com\/index.php?rest_route=\/wp\/v2\/posts\/6633","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.diplomacypakistan.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.diplomacypakistan.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.diplomacypakistan.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.diplomacypakistan.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6633"}],"version-history":[{"count":0,"href":"https:\/\/www.diplomacypakistan.com\/index.php?rest_route=\/wp\/v2\/posts\/6633\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.diplomacypakistan.com\/index.php?rest_route=\/wp\/v2\/media\/6634"}],"wp:attachment":[{"href":"https:\/\/www.diplomacypakistan.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6633"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.diplomacypakistan.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6633"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.diplomacypakistan.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6633"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}