ISLAMABAD: Finance Minis­ter Ishaq Dar on Wednesday said he did not get any discouragement from Washington over possible cheaper oil imports from Russia and reassured the markets that Pakistan would meet all international obligations without default.

Speaking on the sidelines of the All Pakistan Chartered Accountants Conference, Mr Dar, who just returned from the United States after a weeklong visit to attend annual meetings of the World Bank and the International Monetary Fund (IMF), also reiterated that greenback’s value would fall below Rs200 and inflation would also come down in few weeks.

The minister declined to directly confirm if Pakistan would exit the grey list of the Financial Action Task Force (FATF) later this week, saying the watchdog’s process and rules did not allow preemptive statements before its announcements but hoped the good news as Pakistan had complied with relevant standards.

Mr Dar said he had sounded the relevant quarters during the Washington visit about potential oil imports from Russia if the conditions and rates offered to Pakistan were better than India. “I received encouragement. There was no discouragement,” he said without elaborating on the relevant quarters.

Mulls cheaper oil imports from Russia

He said the government was studying the option of energy imports from Russia after all India is doing this and Pakistan could not be discriminated against and would definitely go for Russian imports if rates are better than India.

Default averted

Turning to the default question, the minister said Pakistan had already averted a default that loomed a few months ago because of four years of bad governance and mismanagement of the previous government but rot could not be completely overturned in a few months. “Through you, I want to give a message to markets. There is no reason to get nervous. We are back in business, and there should be no doubt that Pakistan will never default,” he said, adding, “there is no need to worry. There is no point spreading panic. God willing we have our projections, we will arrange evertything. I don’t see any difficulty; there is nothing to worry about”.

The minister recalled that with Almighty’s blessing, the country had overcome even worst conditions after 1998 nuclear blasts when the western powers wanted to punish Pakistan and then again in 2013. “Let me clarify again that there would be no issues and repayments over the next 10 months had been planned,” he said.

Asked about the rupee’s depreciation against the dollar again over the last couple of days, the finance minister said markets were sensitive to the size of the foreign exchange reserves but they were nervous for no reason. He said it was the responsibility of the State Bank of Pakistan to guard the exchange rate and they were fulfilling their duty.

The minister said there were serious challenges the country had been facing but the government had rescued it from default although it had to give a very high political cost. “If there is a choice between state or politics, the priority should be the state and not the politics as if the country is there, there may be politics. If there is no county where will the politics go?” he asked.

The minister said Pakistan required about $32-34bn to fulfill its liabilities and financial needs for 2022-23 which include about $22bn multilateral debt and liabilities of around $12bn. He, however, vowed that the government would work hard to fulfill the sovereign responsibilities to revive the integrity and credibility.

The minister once again rejected any consideration about the rescheduling of the Paris Club’s debt or extension in bond maturity due in December.

The finance minister, however, said the devastating floods had multiplied Pakistan’s deep challenges. He recalled that Pakistan was projected to be the 18th big economy in the world by 2026 leaving behind Canada and Italy but due to the political interest of some parties the dream could not come true and unfortunately it now stood at 54th position.

Published in Dawn, October 20th, 2022