IMF Approves $1.2 Billion for Pakistan in Two Facilities
The International Monetary Fund (IMF) has approved a combined loan package worth $1.2 billion for Pakistan, distributed through two separate financial facilities. This approval aims to bolster Pakistan’s foreign exchange reserves and support economic stabilisation efforts.
Out of the total amount, $1 billion will be disbursed under the Extended Fund Facility (EFF), while an additional $210 million will be made available through the Resilience and Sustainability Facility (RSF). The IMF Executive Board granted this approval after a formal review confirmed that Pakistan had met all prior economic commitments required under the program.
A staff-level agreement between Pakistan and the IMF was reached on March 27, which laid the groundwork for this final disbursement decision by the IMF Board. The agreement underscores Pakistan’s commitment to fiscal discipline, advancing tax reforms, and implementing structural economic reforms across key sectors.
Finance Minister Muhammad Aurangzeb affirmed that Pakistan had fulfilled all preconditions before the Executive Board convened to consider the loan tranche approval. The funds are expected to provide much-needed support to Pakistan’s foreign currency reserves, which have remained under pressure amid ongoing economic reforms.
This financial support from the IMF is part of broader efforts to maintain macroeconomic stability in Pakistan while sustaining reform momentum agreed upon under the extended arrangement with the Fund.
The assistance is timely as Pakistan continues to navigate through economic challenges, including external fiscal pressures and the need for structural adjustments within the economy. Strengthening foreign exchange reserves is critical for the country to stabilize its currency and meet international payment obligations.
The IMF’s dual-facility support reflects targeted financial assistance aimed at both stabilising Pakistan’s short-term economic position and enhancing its long-term resilience and sustainability.