Pakistan Latest: Pressure Mounts From Default Risk, Khan Demands

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Pakistan Latest: Pressure Mounts From Default Risk, Khan Demands

(Bloomberg) — Pakistan Finance Minister Miftah Ismail said the government was committed to reviving the International Monetary Fund program and putting the country back on a “sustainable growth path” after talks with the multilateral lender ended inconclusively the previous day.

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There’s now a prospect of a default for the second time in Pakistan’s history even though the IMF said there was “considerable progress” in the discussions. Parliament is set to meet at 4 p.m. to discuss the current economic and political situation in the country.

Ousted prime minister Imran Khan repeated demands for the government to call for fresh elections in six days, failing which he will return to Islamabad to stage a sit-in with two million people.

Earlier, Khan asked his supporters to gather at the center of Islamabad, defying a court order. The government had called out the army to protect its buildings in the capital amid clashes between protesters and security forces late last night.

Key Developments

  • IMF and Pakistan to Continue Talks for Review of Suspended Loan

  • Default Threat Reaches Pakistan in Deepening Political Crisis

  • Pakistan’s Ousted PM Khan Vows to Defy Government Ban on Protest

All times local:

Finance Minister Says Committed to Reviving IMF Program (9:48 a.m.)

Finance Minister Miftah Ismail said the government is also committed to putting Pakistan back on a “sustainable growth path.”

Commenting on talks with the IMF earlier this week, Ismail said the officials from the multilateral lender emphasized the importance of rolling back fuel and power subsidies.”

Khan Issues Ultimatum to Government to Hold Early Elections (7:55 a.m.)

Ex-premier Imran Khan demanded the government announce elections in six days or else he will return to Islamabad with two million people for a sit-in. The government is unable to handle a deteriorating economy, he added.

Pakistan will not accept a U.S.-backed government, Khan said in an echo of earlier allegations that Sharif and other parties orchestrated his ouster with help from the Biden administration. Washington has repeatedly denied this.

PM Asks Pakistanis to Reject Sit-Ins (7:06 a.m.)

Prime Minister Shehbaz Sharif has asked the country to reject the “dirty politics” of sit-ins that have inflicted huge economic losses in the past, according to local media.

Sharif said the 2014 sit-in by Imran Khan’s Pakistan Tehreek-e-Insaf party forced the postponement of Chinese President Xi Jinping’s visit to the country.

Khan Heads to Democracy Chowk With Supporters (5:09 a.m.)

Imran Khan and his caravan are now heading to Democracy Chowk, a large square located in the government district that is close to the buildings housing the prime minister’s office, parliament and the supreme court.

Pakistan Calls Army to Islamabad (2:05 a.m.)

Pakistan’s administration ordered sufficient army troops into Islamabad to protect important government buildings, according to a notification by the interior ministry.

Khan Reaches Islamabad, Asks Supporters to Reach Center of Capital (12:30 a.m.)

The former premier’s convoy arrived in Islamabad, and he called for supporters to gather near the parliament building, violating a court order that allowed a protest only on the outskirts of the capital. Khan plans to have the barricades removed to enter the city.

Security forces have clashed with supporters and resorted to firing tear gas to disperse the crowd.

Pakistan Foreign Minister said Ongoing Bailout Deal Talks Outdated (11:34 p.m.)

Foreign Minister Bilawal Bhutto Zardari said the ongoing bailout deal between Pakistan and the IMF were outdated given a number of global crises.

He told Reuters at the sidelines of Davos that the IMF deal was “not based on ground realities and the context has absolutely changed from the time that this deal was negotiated.”

IMF and Pakistan to Continue Talks (10:34 p.m.)

The International Monetary Fund will continue its dialog with Pakistan after making “considerable progress” during a week-long mission that ended on Wednesday, the IMF said in a statement.

Pakistan’s finance minister Miftah Ismail said the government planned to reach an agreement with the lender in the current round of talks.

Top Court Allows Khan to Hold a Rally, News Report Says (6:00 p.m.)

The Supreme Court has allowed the former prime minister to congregate with his supporters just outside Islamabad, Geo TV reported.

Government May Allow Khan’s Rally But Not Sit-In (5:30 p.m.)

The government may allow Imran Khan to hold a rally on the outskirts of Islamabad but the former premier must commit to disperse once it’s over, Interior Minister Rana Sana Ullah Khan told a press conference. The government will not allow a sit-in, the minister added.

Khan Pledges Islamabad Sit-In Will be Peaceful (3:14 p.m.)

The former premier has said he will reach the parliament building in Islamabad by removing blockades en route. He told his supporters that the planned sit-in will be peaceful.

Foreign Minister Says Pakistan Has Immense Business Potential (2:42 p.m.)

Foreign Minister Bilawal Bhutto Zardari told a group of business leaders in Davos that Pakistan has immense potential if the country stayed united in the face of the war in Ukraine and climate change.

Khan Leads Rally in Khyber-Pakhtunkhwa Stronghold (1:57 p.m.)

Khan is now leading a convoy from his party’s provincial stronghold of Khyber-Pakhtunkhwa. Rallies have started across Pakistan’s major cities and are all expected to converge at Islamabad later in the day.

Government Says Reports Indicate Khan’s March to fuel Unrest (11:52 a.m)

Pakistan’s government says intelligence reports suggested weapons were being stocked and would be used in the protest to create anarchy. A raid in Lahore has also led to recovery of weapons from the residence of an official with Khan’s Pakistan Tehreek-e-Insaf, a junior Petroleum Minister Musadik Malik said at a press conference.

President Calls for Joint Sitting of Parliament (11:46 a.m)

President Arif Alvi summoned a parliament sitting for Thursday at 4 p.m., according to a statement by his office. No other details were given. Senators and members of the National Assembly will discuss the current political situation, according to a lawmaker from Prime Minister Shehbaz Sharif’s party.

Top Court Hears Petition Challenging Ban on Khan’s Protest (11:00 a.m.)

The Supreme Court is hearing a petition challenging the government’s decision to ban Khan’s protest march and to block off key roads and buildings in capital Islamabad. It’s not clear when the court will hand down an order.

Police Use Tear Gas to Disperse Protesters (10:30 a.m.)

Police used tear gas to disperse protesters in Lahore, the country’s second-largest city and a stronghold of Sharif’s party, as they tried to remove barricades set up to prevent them from heading to Islamabad, local television channels reported.

Pakistan Bonds Advance a 2nd Day, Rupee at Record Low: (9:37 a.m)

Pakistan’s dollar bonds due 2031 climbed a second day on Wednesday, with the debt indicated 1 cent higher at 63.315 cents on the dollar. The nation’s benchmark stock index dropped 0.4% on Wednesday to the lowest since December 2020. On Tuesday, the rupee slid to a record-low 201.41 per dollar.

Imran Khan’s Party to Continue With Protest March (2:15 a.m)

The Pakistan Tehreek-e-Insaf plans to carry on with a protest march to Islamabad to push for the dissolution of the National Assembly and fresh elections. The party plans to hold a sit-in until Khan’s demands are accepted.

Sharif’s government has said it will stop the protest. Gatherings of five or more people in Punjab province have been banned and police have detained several of Khan’s party leaders in overnight raids earlier this week.

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