Flood-hit Pak asks IMF to restructure 11-bln dollar loan

LONDON - Pakistan has urged the International Monetary Fund (IMF) to restructure the existing 11 billion dollar loan to help it cope with the devastating floods, the worst to have hit the country in the last 80 years.

Pakistani officials discussed the possibility of restructuring the existing 11billion loan with the IMF, which was meant for economic reforms in the country.

IMF’s regional director, Masood Ahmed, said the international authority is committed to help Pakistan “through this difficult phase”.

“We need to look at these issues together in an objective way and find a solution that helps the economy during this difficult period, but also keeps them on a path that is going to produce a sustainable basis for growth,” BBC quoted Ahmed, as saying.

“They need to be able to raise more revenue to finance their spending. The government has a very low tax base and we need to be able to find a way where we help them through this difficult phase,” he added.

Earlier, Ahmed had described the catastrophe as a “massive economic challenge” and added that IMF would review the assistance and financial prospects of the troubled nation.

“The floods which have hit Pakistan in recent weeks and brought suffering to millions of people will also pose a massive economic challenge to the people and government of Pakistan,” he had said.

The floods, which have inundated nearly one-fifth part of country, have affected about 20 million people and killed 1600, and President Asif Ali Zardari stressed that would take more than three years for the country to recover from the disaster and cost up to 15 billion dollars.

The UN has appealed for 460 million dollars in aid, but donor countries have so far pledged only half of the target, even as secretary-general Ban Ki-moon urged the international community to donate more, saying immediate funds were needed to help victims over the next three months. (ANI)