Pakistan Seeks $10 Billion US Economic Support

Pakistan has requested a $10 billion Exchange Stabilisation Support Facility from the United States to strengthen its economy.

The request was made by Finance Minister Muhammad Aurangzeb during a meeting with US Treasury Secretary Scott Bessent.

The Exchange Stabilisation Support Facility serves as a financial backstop and can include currency swaps, financial guarantees, and loans.

According to a media report, Pakistan's embassy in Washington confirmed the request but did not provide additional details.

The US Treasury has not responded to the request yet.

Pakistan seeks the support facility to improve its access to international capital markets, increase foreign exchange reserves, and enhance its sovereign credit ratings.

The country's road-to-market strategy aims to restore independent access to global capital markets while boosting foreign exchange reserves.

This approach depends on adhering to International Monetary Fund (IMF) conditions to keep fiscal deficits and inflation under control.

Diplomatic sources in Washington are optimistic about the US response, stating that there are strong chances the request will be approved.

Pakistan continues to face a fragile economic recovery and remains heavily reliant on external financial assistance.

The country narrowly avoided default in 2023 after securing a $3 billion IMF loan programme.

It is currently implementing economic reforms under a $7 billion IMF programme approved in 2024, which is linked to a series of policy conditions.

The US support facility would provide a significant boost to Pakistan's economy, which has been struggling to recover from a series of economic challenges.

The request for support is a testament to the country's ongoing efforts to strengthen its economy and improve its financial stability.

In the coming months, it will be crucial to monitor the US response to Pakistan's request and the potential impact on the country's economy.

The outcome of this request will have significant implications for Pakistan's economic future and its ability to navigate the complexities of the global economy.