PM Shehbaz set to meet Nawaz Sharif, Ishaq Dar in London as economy stutters

Prime Minister Shehbaz Sharif will leave for London tonight to meet brother and Pakistan Muslim League-Nawaz (PML-N) supremo Nawaz Sharif, according to Information Minister Marriyum Aurangzeb, reported Aaj News on Tuesday.

During his visit, the premier, accompanied by other officials, will also meet former finance minister Ishaq Dar.

The visit comes amid reports that the premier is set to have consultations with his brother and the political party's finance czar on the country's economic situation.

Last month, Prime Minister Shehbaz Sharif went on a three-day official visit to Saudi Arabia where he held meetings with relevant officials to discuss ways to enhance economic and trade ties and promote investment

On his way back from the Kingdom, PM Shehbaz made a day-long stop in the United Arab Emirates where he met Abu Dhabi Crown Prince Mohammed bin Zayed Al Nahyan.

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The development comes as Pakistan's new government faces the daunting task of managing a stuttering economy with huge deficits.

Sharif, 70, the younger brother of former premier Nawaz Sharif, was elected as prime minister last month following a week-long constitutional crisis after parliament ousted Imran Khan in a no-confidence vote.

"Imran Khan has left a critical mess," Miftah Ismail, Sharif's finance minister, told a news conference in Islamabad last month, adding the suspended talks with the International Monetary Fund (IMF) would be resumed as a priority.

"We will restart talks with the IMF," he said.

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Pakistan's foreign exchange reserves have been under pressure since December last year. In this regard, the revival of the IMF programme is also crucial for Islamabad.

Ismail had earlier said the government has sought an increase in the size and duration of the IMF's EFF.

“We have requested the IMF to extend the EFF programme by a year from 3 to 4 years,” said Ismail, adding that his team received a positive response in this regard. “We have also requested the fund to enhance the overall loan size by $2 billion,” he said.

Pakistan's current account deficit has widened during the ongoing fiscal year, putting pressure on the rupee that hit a record low against the US dollar on Tuesday.

The central bank last month also hiked key interest rates by 250 basis points to 12.25% in an emergency decision, the biggest hike in decades, citing deterioration in the outlook for inflation and an increase in risks to external stability, heightened by the Russia-Ukraine conflict, as well as local political uncertainty.

The bank also revised average inflation forecasts upwards to slightly above 11% in FY22, which ends in June.