IMF seeks more time to conclude Pakistan deal worth $1.1 billion

Analysts say the money is necessary to prevent Pakistan from defaulting on external payment obligations, and that an IMF deal paves the way for other organisations and governments to provide funds

The International Monetary Fund has asked for more time for negotiations with Pakistan over a deal that would unlock $1.1 billion in much-needed funds for the country, Secretary of Finance Hamed Sheikh said Thursday.

Cash-strapped Pakistan, pushed to the limit by last year's devastating floods, had been host to the talks since late last week in a bid to access the funds, a tranche initially expected last December and part of the IMF's $6.5 billion bailout aimed at warding off an economic meltdown.

"The staff level agreement between Pakistan and IMF will be reached soon," Sheikh, a senior official at the Ministry of Finance, said in a statement to Reuters. "The IMF mission asked for more time for staff-level negotiations."

He said both sides had agreed on "actions and advance measures." The staff-level talks were due to conclude on Thursday.

Broadcaster Geo reported hours earlier, citing sources, that all matters had been settled between both sides over the bailout.

To release the funds, the IMF needs to reach a staff-level agreement with Pakistan, which Sheikh said would then be agreed upon after approval from the IMF's head office in Washington.

Analysts say the money is necessary to prevent Pakistan from defaulting on external payment obligations, and that an IMF deal paves the way for other organisations and governments to provide funds.