ISLAMABAD, Pakistan – The International Monetary Fund (IMF) prefers to negotiate the release of a $1.1 billion tranche with Pakistan’s new government rather than the caretaker administration, sources said.
Discussions for the third and final payout under the $3 billion bailout are expected to begin in early March once federal and provincial governments are constituted.
Per finance ministry officials, the caretaker government has successfully met IMF objectives, setting a positive precedent for the incoming leadership.
If the interim administration performs well, talks with the next government will be smoother, they added.
The IMF program expires in April and the tranche release is considered critical to avoid default on foreign debt obligations.
Experts say the IMF wants to engage with Pakistan’s long-term economic managers to ensure reforms stay on track before approving the payout.
The deadline adds pressure on political parties to swiftly form governments and re-engage the IMF to unlock the financing.