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Pakistan team on Saudi mission in pursuit of economic bailout

Grappling with its worst-ever economic crisis, Pakistan today sent Finance Minister Sartaj Aziz and Punjab Chief Minister Mohammad Shabaz Sharief to Saudi Arabia to drum up support for an economic bailout from Washington and international financial institutions.

Sharief told reporters at Lahore Airport that he was carrying a message from his elder brother and Prime Minister Nawaz Sharief to the Saudi king. The delegation hopes to use Saudi influence to soften the G-8 countries' current tough stance towards Pakistan.

Aziz said Pakistan was in a better situation than some of the east Asian countries. ''The problem has been created because international financial agencies are reneging from their commitments.''

The rupee plunged to an all-time low of 60 to the dollar in the open market on Saturday, a day after the International Monetary Fund decided to go slow on its 1.6 billion dollar assistance package for the country.

Stock markets panicked and with remittances from overseas Pakistanis having come to a trickle after foreign currency accounts were frozen on May 28, the fears of ''default'' became real.

Aziz said Pakistan would overcome the crisis if the IMF were to pay half the instalment promised.

The IMF board is expected to take a final decision on the assistance package in Washington on Monday. The fund's director Paul Chabrier had met Aziz and Nawaz Sharief in Islamabad on Wednesday last.

Shabaz Sharief today also said Pakistan would not sign the CTBT unless the sanctions, imposed by the west in the wake of the nuclear tests, were lifted.

Unlike the Washington visit of former Foreign Minister Sahibzada Yaqub Khan and that of Nepal, Bangladesh, Sri Lanka and the Maldives by Senate Foreign Relations Committee Chairman Akram Zaki, an urgency has been attached to the current trip.

Prime Minister Sharief discussed the economic crisis, sanctions and other strategic issues yesterday with army chief General Jehangir Karamat. No details of their talks were available but newspapers today said General Karamat told Sharief that the economic uncertainty was beginning to pose a threat to national security.

Immediate measures were required to arrest an economic collapse, he is reported to have told the prime minister.

Sharief said the current situation was largely a byproduct of rumours floated by ''vested interests'', viz critics like former president Farooq Ahmad Khan Leghari who said the country was going bankrupt due to the ill-planned policies of the government.

In a related development, the State Bank of Pakistan today started fulfilling the foreign exchange requirements of banks by facilitating them in opening Letters of Credit for imports. A bank directive said the LoC would be opened, subject to a 30 per cent cash margin.

UNI

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