WASHINGTON, Oct 21: The United States has repeated its offer to help rescue Pakistan from the current financial crisis as diplomatic sources in Washington say the International Monetary Fund has agreed to provide $6 billion to the country to boost up its ailing economy.

“It’s hard for me to speculate,” said State Department’s deputy spokesman Robert Wood when asked if the IMF had agreed to offer a rescue package to Pakistan. But “we obviously will try to see what we can do to help Pakistan get through its financial crisis”.

Pakistan had “no choice but to seek help from the IMF,” said another State Department official. The official, who was not identified, was quoted in the US media as saying that Pakistani officials knew it would not be a popular decision in Pakistan but they had to go to the IMF.

“It won’t be popular with the public and it sends a lot of negative signals about Pakistan’s financial situation, its creditworthiness. But it’s a decision the Pakistanis are going to have to make,” he said.

The country’s inflation is running at around 25 per cent, and its foreign currency reserves are rapidly depleting, forcing the government to seek emergency cash advance from friendly countries and international financial institutions.

Pakistan is reportedly discussing a $10 billion to $15 billion support package with the IMF and other bodies.

Diplomatic sources in Washington have told Dawn that the IMF has agreed to provide $6 billion to Pakistan to stabilise its economy and to help avoid defaulting on foreign debt repayments due next year.

The money will be available at 5 to 6 per cent interest while Pakistan also has agreed to readjust its monetary policies to qualify for the loan.

The country has already withdrawn subsidies on oil and oil products, a major IMF demand that may hurt millions of ordinary consumers across Pakistan.

“Since Pakistan had already taken some of the most difficult and painful measures, the IMF is willing to help,” said a diplomatic source involved in negotiations between Pakistan and the IMF.

Diplomatic sources said the United States is playing a key role in persuading international financial institutions to help Pakistan but it is also urging Islamabad to undertake serious economic reforms.

Some of Pakistan’s key allies, such as China, also have urged Pakistan to go to the international community with concrete economic plans for seeking assistance instead of “going door-to-door, asking for money,” said Shahid Javed Burki, a former finance minister and vice president of the World Bank.

At the State Department briefing, Mr Wood refused to disclose US plans for helping Pakistan but assured Islamabad that Washington was considering various options.

“It would be premature for me to get ahead of what we may decide to do back here from Washington … but obviously, the situation there is of great concern, not just to us, but obviously to the Pakistanis,” he said.

“And so we will look at ways we can try to help Pakistan, you know, get through this crisis. But beyond that, I don’t have any specifics for you.”

Pakistan’s front-line role in fighting terrorism persuades Washington to help prevent an economic collapse. Policy planners in Washington fear that an economic meltdown will leave this nuclear-armed country of 160 million at the mercy of extremist groups like Al Qaeda and Washington wants to avoid this.

Other Western and Middle Eastern nations also have similar fears and are willing to help.