Once the International Monetary Fund (IMF) team arrived to negotiate the specifics but left without reaching a final deal, Pakistan entered a panic situation. Even though Prime Minister Shehbaz Sharif and Finance Minister Ishaq Dar agreed to all the prerequisites, the deal did not go through.
Islamabad now intends to raise money by selling a property associated with its embassy in Washington. As of December 2022, for a building that formerly housed the defence section of the nation's embassy in the US capital, Pakistan received three offers.
A Jewish group offered the highest bid, about $6.8 million, in order to construct a synagogue inside the structure. According to diplomatic sources cited by Dawn, an Indian real estate agent placed the second highest bid of roughly $5 million while a Pakistani real estate agent placed the third bid of about $4 million.
Pakistan had $16.7 billion in foreign exchange reserves in 2022. Now, Pakistan's debt is equal to 80% of its GDP. Pakistan can only cover the import cost for the next three weeks with its remaining foreign exchange reserves of just $3 billion. Pakistan has 29 days' worth of diesel and 21 days' worth of gasoline stocks left, according to Pakistan-based The Express Tribune.
The Shehbaz Sharif administration has significantly burdened the public by acceding to the IMF's demands. In order to secure loans, Pakistan has sharply increased the cost of diesel and petrol. Wedding lawns, shopping malls, and markets have been asked to close early in order to reduce the consumption of petrol.
Pakistan reportedly has an external debt of ₹10 lakh crore. As there is ongoing fear of an economic situation similar to that in Sri Lanka, the wealthy in Pakistan will have a chance to leave the country. However, the underprivileged will either try to emigrate to a neighbouring country or get into serious financial trouble.
During an earlier visit to Islamabad, US State Department Counselor Derek Chollet stated that the United States was concerned about Pakistan’s debt owed to China.
"We have been very clear about our concerns not just here in Pakistan, but elsewhere all around the world about Chinese debt, or debt owed to China," Chollet told journalists in the US Embassy in Islamabad.
