ISLAMABAD: The International Monetary Fund (IMF) announced that its Executive Board has approved a critical $3 billion bailout programme for Pakistan, out of which $1.2 billion will be immediately disbursed to help the cash-strapped nation.
The global lender’s announcement on Wednesday came just weeks after the IMF and Pakistan had reached a Standby Ar-rangement on June 29 to ease the country’s financial crisis, reports Dawn news.
In a statement issued late Wednesday night, the IMF said: “The Executive Board of the IMF approved a nine-month Stand-By Arrangement (SBA) for Pakistan for an amount of about $3 billion, or 111 per cent of quota, to support the authorities economic stabilisation programme.
“A difficult external environment, devastating floods and policy missteps have led to large fiscal and external deficits, rising infla-tion and eroded reserve buffers in FY23.”
In response to the development, Prime Minister Shehbaz Sharif said the bailout was a major step forward in efforts to stabilise the economy, the BBC reported.
“It bolsters Pakistan’s economic position to overcome immediate to medium-term economic challenges, giving next government the fiscal space to chart the way forward,” he said.
Earlier this week, Pakistan also received $2 billion in funding from Saudi Arabia and another $1 billion from the United Arab Emirates.
The IMF deal came after eight months of tough negotiations over how to deal with serious long-term issues with Pakistan’s ailing economy. The crisis-hit country had been on the brink of being unable to meet debt repayments to creditors. (IANS)
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