Pakistan's central bank said Thursday its foreign exchange reserves had dropped to $3.1 billion dollars, as the IMF and the government remained locked in urgent talks for emergency funding.

Pakistan's economy is in dire straits, stricken by a balance of payments crisis as it attempts to service high levels of external debt, amid political chaos and a deteriorating security situation.

The State Bank of Pakistan's forex reserves, held mostly in US dollars, dropped from $3.7 billion the previous week.

Analysts said it was enough to cover 18 days of imports.

"A default looks imminent, barring a miracle," analyst Yousuf Nazar based in Britain tweeted.

An official with the ministry of finance, who asked not to be named, told AFP that this was the lowest level of central bank reserves since 2013 and 2014.

Economists say the government -- which fears introducing tough conditions ahead of a general election later this year -- has no choice but to bend to the demands of the IMF and revive a stalled aid package.

A deal would also crucially unlock further loans from friendly nations reluctant to help until the IMF programme is back on track.

On Wednesday, year-on-year inflation had risen to a 48-year high in crisis-hit Pakistan, recorded at 27.55 percent.

Nasir said it "reflects badly on the management -- on the managers of the economy".

A delegation from the IMF arrived in Islamabad on Tuesday.

In the past week, with the prospect of national bankruptcy looming and no countries willing to offer less painful bailouts, Islamabad has started to bow to pressure to meet IMF demands.

The government loosened controls on the rupee to rein in a rampant black market in US dollars, a step that caused the currency to plunge to a record low. Artificially cheap petrol prices have also been hiked.

The central bank is no longer issuing letters of credit, except for essential food and medicines, causing a backlog of thousands of shipping containers at Karachi port stuffed with stock the country can no longer afford.

Industry has been hammered by the imports block and massive rupee devaluation. Public construction projects have halted, textile factories have partially shut down and domestic investment has slowed.

Former prime minister Imran Khan, who was ousted last year in a no-confidence motion, negotiated a multi-billion-dollar loan package from the IMF in 2019.

But he reneged on promises to cut subsidies and market interventions that had cushioned the cost-of-living crisis, causing the programme to stall.

It is a common pattern in Pakistan, where most people live in rural poverty, with more than two dozen IMF deals brokered and then broken over the decades.