ISLAMABAD, Oct 21: Pakistan needs five billion dollars from multilateral lenders and friendly countries to avert a balance of payments crisis, the prime minister’s adviser on finance told Dawn on Tuesday.

Shaukat Tareen said that a positive assessment of Pakistan’s economy by the International Monitory Fund would spur international lenders to release funds to enable the country avoid a debt default.

He said the Dubai meeting with IMF officials was a normal consultation under Article IV, but it provided an opportunity to Pakistan to get its home-grown economic revival programme approved.

He said the government had estimated that it would need an amount ranging between $3.4 and $4.5 billion, but multilateral lenders had assessed the country would need $5 billion to bridge the gap in the balance of payments.

“I never said that Pakistan is seeking $10 to $15 billion assistance from multilateral lenders, including the IMF,” he added.

Mr Tareen said he was not attending the Dubai meting because it was a normal consultation between IMF representatives. He said the representatives would review Pakistan’s economic indicators and prepare a report for approval by the IMF board.

“If the IMF endorses our home-grown economic strategy and establishes credit lines, Pakistan will go for the IMF programme on its own terms,” the adviser said.

The IMF’s Middle Eastern and Central Asian chief, Mohsin Khan, had recently said that the Fund was ready to offer a programme to Pakistan, but Islamabad had so far not formally aproached it.

Mr Tareen said Pakistan had pinned high hopes on “Plan A -- multilateral lenders’ developmental loan -- and “Plan B” -- Friends of Pakistan assistance -- which would help in securing the required funds.He said everything would be clear after the Friends of Pakistan meeting scheduled for next month in Abu Dhabi. “If Pakistan gets no help from the Friends, it will have to go for the IMF programme,” the adviser said.

Pakistan’s new programme seeking IMF endorsement will be primarily aimed at reducing poverty. Under the plan, apart from cash transfers to the poorest households, the government will provide health insurance, skills development opportunity for at least one member of every family and a suitable development support that will create temporary employment opportunities at the union council level.

The programme will be supported by initiatives to revitalise agriculture, make the industry competitive, meet growing energy needs, raise capital and finance for development, remove infrastructure bottlenecks through public-private partnership and reinvigorate the institutions of governance.

Agencies add: Pakistani finance officials, faced with a looming economic meltdown, brought their case on Tuesday to the IMF, even though Islamabad has said it will only seek money from the agency as a last resort.

IMF spokesman Niels Buenemann declined to give any specifics about the talks being held in Dubai, but Pakistani officials have said they may have to ask the fund for cash to avoid defaulting on sovereign debt due for repayment next year.

Analysts believe Pakistan’s front-line role in fighting terrorism will persuade other countries, including the US, to help prevent it from economically imploding. But a global economic crisis, including severe problems in the US, could limit assistance.

The Financial Times reported on Tuesday that Pakistan was in informal discussions with the IMF and other bodies over a $10-$15 billion package designed to stabilise its economy and avoid a balance of payments crisis.

A little over half the total would come in the form of an IMF loan and the balance would be provided by the World Bank, the Asian Development Bank and bilateral donors, potentially including Saudi Arabia, the report said. Pakistan was also seeking funds from China, it added.

A senior Pakistani official said the country was considering an IMF loan that would disburse funds over the next two years to bolster investor confidence shaken in part by falling foreign currency reserves, the newspaper added.

“We are basically seeking help for around seven quarters including the one which began this month,” the Financial Times quoted the official as saying.

The Wall Street Journal quoted an official in Pakistan’s Finance Ministry as saying that the government was looking for $4 billion to avoid defaulting on its debt.

“We are hopeful that Pakistan will get approval soon, with the country receiving $1.5 billion in one go and the rest in five equal instalments of $500 million,” the official said.

International officials indicated the IMF would not impose extensive new conditions, but would essentially bless the reform programme prepared by Pakistan’s economic team. However, the IMF would require changes in monetary policy, the report said.