Teenager Amanullah Khan teeters on his tiptoes, daubing towering camels with festive henna patterns to entice Eid al-Adha customers at a market near the Pakistan capital.

Hundreds of farmers have camped at livestock markets across Pakistan for weeks, hoping to sell animals before the annual holy festival, starting on Thursday.

But with rampant inflation – reaching a record 38 percent in May – markets are attracting smaller crowds.

The Muslim festival begins a day before the deadline for Pakistan to secure a $6.5bn bailout programme with the International Monetary Fund (IMF) expires on June 30.

Local media reports on Wednesday said the Pakistani government is discussing a $2.5bn “standby arrangement” for six to nine months with the global lender to prevent a default.

‘Prices are sky high’

Khan’s cousin Zakaria brought 18 camels to market after good profits last year but has sold only one so far.

“People’s purchasing power is over. Customers are not coming to the market, and those who come prefer to return empty-handed due to the high prices of the animals,” Zakaria, 21, told the AFP news agency.

During the festival, Muslims around the world will slaughter an animal – a goat, sheep, bull or camel – keeping a third for themselves before giving a third to friends and relatives, and a third to charity.

The ritual commemorates the readiness of Ibrahim – Abraham in the Christian and Jewish faiths – to sacrifice his son to show obedience to God.

The centuries-old festival is guided by tradition. But this year, many middle-class Pakistanis will not be able to perform a sacrifice.

“Our income is the same but the prices are sky-high. From where would we get that much money?” buyer Ali Akbar, a 46-year-old builder, asked.

Another customer, Zerak Ali, had come to enquire about the price of a camel, which can cost up to 1 million rupees ($3,500).

“It is worth 700,000 [rupees] for you,” Zakaria barters. But 56-year-old shopkeeper Ali leaves, leading his two grandsons towards the enclosure housing cheaper bulls.

Camel sacrifice is not common in Pakistan, but some wealthier buyers prefer the animal because 11 families can share its meat, according to Islamic rules.

More than 250 camels have been brought to the Islamabad market, along with thousands of bulls, cows, goats and sheep.

Bulls cost up to 500,000 rupees ($1,750), while the price of goats ranges from 50,000 ($175) to 150,000 rupees ($525).

Eating into Zakaria’s profits are market taxes, rising fodder and truck rental prices, as well as staff wages. “I will lose millions of rupees this year,” he glumly predicts.

IMF package awaited

Pakistan rushed through a recent slew of policy adjustments, including a revised budget sought by the IMF and an off-cycle hike in interest rates, hoping to secure the pending funds under the Extended Fund Facility (EFF) programme signed in 2019.

With time running out, Finance Minister Ishaq Dar on Tuesday said the two sides were working on a “mechanism” to ensure that Pakistan got the entire $2.5bn and not just the close to $1.1bn due under the current review.

Dar did not elaborate on what the mechanism was.

The ninth review is in order after recent adjustments but Pakistan is keen to receive the entire amount that has not been disbursed, which is only possible in a new programme, the Express Tribune daily said, quoting sources.

It said Prime Minister Shehbaz Sharif discussed signing a new standby arrangement (SBA) worth $2.6bn for a short term of six months with IMF Managing Director Kristalina Georgieva.

Pakistan’s Dawn newspaper also said an SBA was one option discussed to access pending funds after the expiry of the EFF.

The South Asian nation is in dire need of external financing and has allocated $2.5bn in IMF support in its annual budget, which will also be key to unlocking other avenues of funding.

On Tuesday, Sharif said he expected an agreement in a day or two, with the lender saying it was holding talks with the aim of “quickly reaching an agreement on financial support from the IMF”.

Meanwhile, Bakht Zaman, a farmer from Mardan district in Pakistan’s northwest, says he brought 10 camels to market and has so far sold only one for 500,000 rupees.

“The value of the Pakistani rupee has fallen,” says buyer Haq Nawaz. “Who will buy such expensive animals?”