NUSA DUA, Indonesia -- Pakistan has formally asked the International Monetary Fund for financial assistance, the fund said on Thursday, amid concerns over its ability to meet its external debt obligations as the country battles dwindling foreign currency reserves.
IMF Managing Director Christine Lagarde said in a statement she had met with Pakistan's Minister of Finance, Revenue and Economic Affairs Asad Umar, Governor of the State Bank of Pakistan Tariq Bajwa and members of the economic team on the sidelines of the IMF and World Bank annual meetings in Bali.
Lagarde added that an IMF team will visit Islamabad, the capital of Pakistan, "in the coming weeks to initiate discussions" for possible assistance from the organization.
Pakistan had asked the IMF for help on numerous occasions from the late 1980s and new Prime Minister Imran Khan had tried to avoid going down the same route by instead courting allies like China for financial aid.
But with the country's foreign currency reserves depleting to the extent that it can barely cover imports until the end of the year, Khan decided that the IMF was the best option.
Speaking to Nikkei in Bali on Thursday, Finance Minister Umar said that Pakistan needs $12 billion.
IMF's help is not guaranteed, however. Pakistan has been a heavy recipient of Chinese investment in recent years through Beijing's Belt and Road Initiative, stoking concerns that any IMF bailout package could be used to pay off Chinese debts.
Speaking earlier in the day, Lagarde said that any IMF loan, whether to Pakistan or other countries, requires "a complete understanding and absolute transparency about the nature, size and terms of the debt that is bearing on a particular country."
Nikkei staff writer Takashi Nakano in Nusa Dua contributed to this report.