'The world has not come out of recession ... and maybe I just may need more dollars, so I might as well have more insurance,' Tarin told investors at an event organized by the Asia Society in New York.

Pakistan signed a $7.6 billion loan deal with the IMF in November to avert a balance of payments crisis. The fund recently reviewed the country's performance under the deal before releasing a third loan tranche of roughly $875 million.

Tarin said he had asked the IMF mission to review the loan deal after announcing the 2009-10 budget as some of the requests from the multilateral lender were already being addressed in the budget plan.

Pakistani officials met the mission in Turkey last week to discuss the performance and Tarin said the meeting was a success.

'Everything went very well,' Tarin said, adding that the IMF would issue a statement to that effect while presenting a proposal to the board, which is to meet in August.

The IMF program has got off to a good start, according to Tarin, with inflation easing from a high of 25 per cent hit in October and the central bank's reserves back above $8 billion after falling to $3.3 billion last November.

But analysts say the fight against Taliban militants in the country's northwest as well as uncertainties created by the slump in global demand and domestic power shortages add to the challenge of pulling the economy out of what is likely to be an extended phase of sluggish activity.