LAHORE, Oct 9: Pakistan may seek another International Monetary Fund (IMF) credit facility to improve its dwindling foreign currency stocks and cover its increasing current account deficit, officials told Dawn on Thursday.

Until recently the government had consistently been shrugging off reports that it could join a fund programme to salvage the sliding economy.

“Nothing can be ruled out. A low-cost IMF loan is one of the several options being considered by the government,” a senior finance ministry official told this reporter from Islamabad.

“We need dollars to ease pressure on the rupee and restore the investor confidence in our economy and currency, and are exploring various avenues,” he said in reply to a question.

The departure of a delegation, headed by the newly-appointed prime minister’s advisor on finance, Mr Shaukat Tareen, on Wednesday night for Washington for discussions with the IMF and the World Bank on Islamabad’s strategy to get out of its current economic morass has triggered speculations in both the official and business circles that Pakistan may join another fund programme.

The last time the country joined a fund programme – the Poverty Reduction and Growth Facility (PRGF) – of $1.5 billion was in December 2001 for a period of three years.

The arrangement was, however, terminated prematurely because the then government did not feel the need to complete it.

At that time, the government had also stated that it was the last time Pakistan had joined an IMF programme.

But with the country’s foreign currency reserves falling to $8.3 billion from $16.4 billion a year ago and the rupee hitting its historic low in the inter-bank market during the last couple of days, the finance managers appear to be reconsidering seeking a fresh facility from the IMF to cover its immediate foreign exchange needs.

Pakistan is said to be requiring immediate foreign capital inflows – almost all sources of foreign capital inflows have already dried up or slowed down since the beginning of the year – of more than $10 billion to boost the economy over a period of next few months.

“If Pakistan joins the IMF facility, it will not be for shoring up our foreign currency reserves alone. We will be seeking it because the IMF’s decision to support us will send a very positive signal to the world and help restore the investor confidence in our economy and our ability to get out of the present economic mess,” the official said.