Pakistan must consider IMF pill, Zardari says

Islamabad: Pakistan is averse to an International Monetary Fund (IMF) loan, but the country must consider IMF help as a cure for its ailing economy, President Asif Ali Zardari was quoted on Monday as saying.

Pakistan is facing a balance-of-payments crisis that analysts say has left the country little option but to accept IMF help. The government has yet to make a formal request and is hoping other donors will come through with funds.

"Getting aid from the IMF is our last option," Zardari told the Saudi Gazette in an interview published in Pakistani newspapers on Monday.

But he added: "Actually, we must consider the IMF option as a medicine that will ultimately cure our ailing economy."

Zardari will travel to Saudi Arabia on Tuesday to seek economic assistance including deferred payments for its crude oil imports.

Zardari said Pakistan's annual oil bill had gone up to $12 billion from $3 billion in five years. "Such an increase is also creating difficulties for our budget as we have tried to protect our people from the rising cost of energy by subsidising fuel and electricity," he said.

Pakistan's economic woes began before the global financial crisis escalated in September as its battled rising global prices for raw materials and food.

But analysts say the crisis has compounded Pakistan's difficulties by making donors, trying to protect their own economies, reluctant to step in.

Pakistan has been seeking assistance from its allies, including the US and China, but diplomats say donors, including Saudi Arabia, want to see the government reach a pact with the IMF before considering their own help.