The government has been lucky so far when it comes to the International Monetary Fund (IMF) bailout packages. Though it is still necessary for Pakistan to get the highly unpopular IMF loan, a decision the PTI government was criticized for, Pakistan will be in a better position than it ever has been to bargain in front of the IMF. Thanks to the Saudi Arabian and China bailout packages, and rumoured ones from UAE and Malaysia, Pakistan is not as dependent on the IMF and can ask for less stringent conditions with the loan. The only looming obstacle towards a good IMF package was the United States’ scrutiny on Pakistan securing loans, and now it appears that may have eased up too.

The US Treasury Department has informed Congress that Pakistan will pay off an International Monetary Fund (IMF) bailout before its loans from China become due. The Treasury’s undersecretary for international affairs, David Malpass, has stated that China is not main concern for the US when it comes to Pakistan; rather the priority is that the IMF package is utilised to create substantial economic reform.

This position is in stark contrast to US’s past statements. Secretary of State Mike Pompeo has previously warned against any IMF bailout for Pakistan that would pay off Chinese loans to Pakistan. Categorically, the US administration asked not to fund any project that is part of the CPEC and called for conditions attached to the loan which would prevent paying back Chinese loans- something which would put Pakistan in a difficult position and risk offending China.

What prompted this change of heart is unknown but it is certainly a welcome approach by the US, which is finally adopting a reasonable stance with Pakistan. However, the financial ministry shouldn’t rest too easy; knowing the mercurial nature of the current US administration, this stance might change at a moment’s notice.