Riyadh signals readiness to provide more credit.

ISLAMABAD -- Pakistan claimed on Wednesday that it received an indication from Saudi Arabia for additional loans that may help to break gridlock with the International Monetary Fund (IMF) and said that it was not planning to prematurely quit the $6.5 billion programme.

'We have received an indication from Saudi Arabia about getting something,' Dr Aisha Pasha, the Minister of State for Finance, said after attending a meeting of a parliamentary committee, without explaining the loan amount.

She also informed the Senate Standing Committee on Finance that some progress was made a day earlier on a friendly country deposit, saying, 'we will soon reach the stage to sign the Staff-Level Agreement with the IMF'.

The IMF has asked Pakistan to arrange $6 billion in additional loans and at least half of those must be materialised before the board meeting. The funds are needed to avoid sovereign default and also increasing the foreign exchange reserves to a level sufficient to back 1.7 months of imports.

Pakistan had told the IMF that it would get $2 billion in additional loans from Saudi Arabia and $1 billion from the UAE to meet the additional financing requirements.

Hamad Obaid Ibrahim Salim Al-Zaabi, Ambassador of the UAE also called on Finance Minister Ishaq Dar. The finance minister highlighted various avenues in which both countries could enhance their existing trade and investment relations, according to the finance ministry handout.

Sources said the IMF wanted the $3 billion to be arranged from a combination of bilateral and commercial loans.

It is obvious that the foreign commercial banks will not lend until there is a staff-level agreement with the IMF, Dr Aisha said while responding to a question after the meeting.

The ninth review talks ended inconclusively on February 9 and since then Pakistani authorities had been claiming to close the deal with the IMF 'in few days'.

Their relations soured after Prime Minister Shehbaz Sharif announced Rs50 per litre petrol subsidy on the advice of the Petroleum Division but without the endorsement of the finance ministry.

We are telling the IMF that Saudi Arabia and the UAE will come through for us and because of these two countries, Pakistan would soon reach the staff-level agreement stage, the state minister said. She said IMF was taking time to independently verify that from them.

People and the industry have suffered a lot because of increase in prices of electricity, gas, rupee devaluation and the...