World community pledges $4bn to Pakistan
ISLAMABAD: The international community has assured Pakistan of providing US$4 billions to avoid bankruptcy, but in return Islamabad will have to introduce some tough economic reforms.
US and diplomatic sources in Washington told that Pakistan had started negotiating with international financial institutions and friendly countries soon after realizing that it might have to default on its payments without foreign help.
US played a vital role in these talks. A US official present in the talks told there was a real panic in the Pakistani side, adding Pakistani diplomats made 10 visits to the US during the last 10 days.
The final negotiations were undertaken during Financial Adviser Shaukat Tareen’s visit to Washington who arrived here to attend the annual meetings of World Bank.
During these talks, the World Bank, Asian Development Bank, Islamic Development Bank and other IFIs discussed various options for providing short to medium-term support to Pakistan.
During the current financial year, the World Bank will provide $1.4 billion. If Pakistan’s programmes are approved, its IDA share will also be front-loaded. This includes a total $3 billion of international development assistance over three years, from 2008-2011.
The Asian Development Bank is negotiating assistance of another billion dollars. The Islamic Development Bank is negotiating a proposal to raise its trade facility from $500 million to one billion. This brings the total pledges to about four billion dollars.
Source: The News.