In the wake of declining foreign reserves that have triggered a panic in Islamabad to prevent the possibility of default, The Chief of Army Staff (COAS) General Qamar Javed Bjwa has sought out Washington to seek assistance in securing a quick loan disbursement by the International Monetary Fund, A Japanese news agency Nikkei Asia reported on Friday.
According to the report The the Chief of the Army Staff (COAS) General Qamar Javed Bajwa is active in steering the country through economic turmoil and has sought US assistance for the urgent return to the International Monetary Fund (IMF) loan program to prevent the risk of default.
“Gen. Qamar Javed Bjwa,” the commander of Pakistan’s influential army, called to U.S. Deputy Secretary of State Wendy Sherman in a highly unusual gesture in the last week of this month, as per people from and the U.S. and Pakistan.” The report in Nikkei Asia claimed.
COAS Bajwa reportedly made an appeal to officials from the White House and Treasury Department to press the IMF to immediately provide the nearly $1.2 billion which Pakistan is scheduled to receive under the resumption loan program.
The report also said that the prime minister Shehbaz Sharif is not a person with much political credibility or credibility beyond Islamabad and is under constant pressure from the ousted Imran Khan. The power, according to observers, is in General. Bajwa, 61, an infantry officer, who was supposed to retire in the past three years but stayed throughout a long period of backroom politics.
On July 14th on the 14th of July, the International Monetary Fund (IMF) and Pakistan reached an agreement on staff levels to release US$1.17 billion in the context of the 7th and 8th review in Pakistan’s Extended Fund Facility (EFF).
A statement released by the Fund stated that the deal must be approved by Executive Board of the IMF’s Executive Board.
Without an immediate solution to halt the ravaging inflation, the Pakistani economy is likely to suffer from hemorrhaging. The rupee is soaring against the dollar and the country has just $9 billion of reserves in foreign reserves, which covers just under two months’ worth of imports. This week, S&P Global downgraded Pakistan’s outlook from stable to negative.
According to an IMF official There is a huge difference between staff approval in comparison to approval by the board. “Our stakeholders, which are the countries who vote on whether they’re in support of the proposal or not take their final decisions,” stated the official. “This is a significant difference. The legally binding element is Board approval and not a staff-level accord.” It was noted.
It is important to note it is worth noting that U.S. is the largest shareholder of the IMF, established in 1945. Although Washington has voted to fund Pakistan at times but the Trump administration has publicly expressed reservations regarding the use of IMF loans to repay China.
As comparisons are drawn to Pakistan’s troubled neighbour Sri Lanka, the stakes of default for the nuclear-armed Islamic republic are much higher. Pakistan has a population of more than 220 million, and boundaries to China, India, Iran and Afghanistan as well as Afghanistan. It is also fighting Islamist and separatist movements; and is located at the intersection with both the Persian Gulf and the Indian Ocean.