ISLAMABAD (Khyber Mail): The International Monetary Fund (IMF) has reached a staff-level agreement with Pakistan regarding the final review of a $3 billion bailout. Following approval from the Fund’s Executive Board, Pakistan is set to receive $1.1 billion. This funding represents the last tranche of a critical rescue package secured by Pakistan last summer, which successfully averted a sovereign debt default.
The agreement acknowledges the strong program implementation by the State Bank of Pakistan and the caretaker government in recent months. Additionally, the new government’s commitment to ongoing policy and reform efforts aims to transition Pakistan from stabilization to a strong and sustainable recovery.
Nathan Porter, the IMF mission chief in Pakistan, emphasized that the country’s economic and financial position has improved since the first review. Growth and confidence are rebounding due to prudent policy management and renewed inflows from multilateral and bilateral partners. However, Porter cautioned that growth is expected to be modest this year, and inflation remains above target.
To address Pakistan’s deep-seated economic vulnerabilities, ongoing efforts are necessary. The current government is dedicated to broadening the tax base and ensuring timely power and gas tariff adjustments that maintain average tariffs while protecting vulnerable populations. The IMF’s Board is expected to consider the review in late April following the formation of the new cabinet.