Pakistan
US think tank warns Pakistan is facing risk of defaulting on its debt real
Islamabad: United States Institute of Peace (USIP), a Pakistan-based think tank, has said there is “a real danger that Pakistan could default on debt”, which might further intensify political turmoil amid already surging terrorism in the nation.
The author of the analysis published on Thursday warned that amid skyrocketing inflation, political conflicts, and rising terrorism, the country is facing the risk of a default due to its massive external debt obligations, reports The News International.
The cash-strapped nation is reeling with the repercussions of a deepening political crisis — which initially began in April last year when former prime minister Imran Khan was ousted through a vote of no-confidence motion — and the derailment of the $6.5 billion International Monetary Fund (IMF) programme.
Islamabad has been hosting an IMF mission since late January to negotiate a series of policy measures to secure $1.1 billion in funding for the cash-strapped economy, which is on the verge of collapse, the Pakistani newspaper reported.
The funds are part of a $6.5 billion bailout package the IMF approved in 2019, which analysts say is critical for Pakistan to avert defaulting on external payment obligations.
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