Pakistan asks IMF to ease terms of loan
PAKISTANI officials will ask the International Monetary Fund (IMF) to ease the terms of a $10bn (€12.2bn) loan today, amid warnings that the cost of devastating floods will undermine the fight against the Taliban.
The government has already said it will divert cash from building roads, schools and clinics -- seen as crucial to marginalising extremists -- to pay for emergency food and medicines.
Crops, roads and factories have all been destroyed and millions of livestock swept away. Officials believe reconstruction will cost as much as $15bn.
Farahnaz Ispahani, adviser to President Asif Ali Zardari, said: "The floods have disrupted the lives of 20 million people and will have devastating consequences for the economy.
"Pakistan will seek a revision of conditionalities on the existing IMF facility and might also look at the possibility of further borrowing."
More than 200,000 people were evacuated from towns and villages in the southern province of Sindh as floods swept through the region.
Pakistan has received about $7bn of a $10.66bn IMF loan agreed in 2008 to head off a balance of payments crisis. Ashfaque Hassan Khan, a former economic adviser to the government, said a deal was crucial. "If the IMF is standing behind a sovereign country, that will restore the confidence of global investors," he said. (© Daily Telegraph, London)