Although finance minister Ishaq Dar, who returned yesterday from Washington after talks with the IMF, expressed optimism that the loan would come through within a week, fund sources said talks were still on and nothing concrete had been finalised as yet.

Dar said that some kind of agreement with the IMF would be wrapped up within a week but reports from Washington indicated that the loan would not come through before mid-November.

A report from Washington quoting an IMF official, hinted that Pakistan's differences with world bank-funded independent power producers (IPPs) had held up progress in the talks.

"We discussed all outstanding issues, including IPPs, with finance minister Ishaq Dar last week and all I can say is that discussions are still on," the news daily quoted an IMF spokesman assaying.

Dar also confirmed that the government's talks with IPPS had run into a dead end, further causing a setback to the government's efforts to get early clearance for the loan.

The IMF had said it would give a letter of intent for the loan only after Islamabad settles its dispute with the IPPs. This is not likely to be sorted out before October. Even when it is, the IMF will take another three-four weeks to formally notify the loan and get the board's nod for it.