Pakistan to Meet IMF Amid Growing Economic Problems

Pakistani officials are scheduled to meet International Monetary Fund (IMF) officials in Dubai Tuesday, as the South Asian country faces serious economic problems.

Analysts say Pakistan needs anywhere from $3 billion to $4 billion to stabilize its economy and avoid defaulting on foreign debt due to be repaid next year. The country's inflation is running at around 25 percent, and its foreign currency reserves are rapidly being depleted.

The nuclear-armed nation, a key U.S. ally in fighting terrorism, has been plagued with political instability, a struggle with Islamic militants based along the Afghan border, and the global financial crisis.

Pakistan economic officials say they will ask the IMF for an emergency cash advance only as last resort.

The Financial Times reports that Islamabad is discussing a $10 billion to $15 billion support package with the IMF and other bodies.

U.S. Assistant Secretary of State Richard Boucher told reporters in Islamabad Monday the international community will take a coordinated approach to help Pakistan. Boucher stressed that Pakistan will not be getting a "cash advance." Instead, he said any financial assistance will be directed to certain areas.

The United States is part of a group called the "Friends of Pakistan," which includes China, Britain and Saudi Arabia. The group will address Pakistan's economic crisis at a meeting next month in the United Arab Emirates.

Some information for this report was provided by AFP, AP and Reuters.