SBP also receives an additional $200 million under the Resilience and Sustainability Fund
State Bank of Pakistan. Photo: Archive
The International Monetary Fund (IMF) has released a tranche of $1.2 billion to Pakistan, confirmed by the State Bank of Pakistan. According to State Bank of Pakistan officials, $1 billion of the amount was disbursed under the Extended Facility Facility (ESAF) programme, while the IMF released an additional $200 million as climate finance through the Resilience and Sustainability Facility (RSF).
The IMF Executive Board on Monday approved the release of the $1.2 billion tranche for Pakistan. The funds are provided under the EFF and RSF programs, bringing total disbursements under these programs to $3.3 billion.
According to the decision, this would keep the two $8.4 billion loan programs going.
The IMF noted that Pakistan has made significant progress on reform measures under the SAF, maintaining economic stability despite a challenging global environment and recent devastating floods.
Financial performance remained strong, with a 1.3% primary surplus recorded for fiscal 2025, in line with targets. While inflation increased, the IMF described it as temporary, due to disruptions in food supplies.
Read: IMF approves $1.3 billion loan for Pakistan
Foreign exchange reserves have increased to $14.5 billion, showing significant improvement compared to the previous year, with further increases expected in the next fiscal year.
After the Executive Board meeting, IMF Deputy Managing Director Nigel Clarke stated that Pakistan’s economic reforms have played a key role in maintaining macroeconomic stability under difficult conditions.
He highlighted positive signs, including higher economic growth, lower inflation expectations and reduction in fiscal and external deficits. However, he highlighted that given global uncertainties, Pakistan needs to accelerate reforms with cautious policies to ensure sustainable growth led by the private sector.
To secure the IMF board meeting date, Pakistani authorities had agreed to fulfill two prior actions: a guarantee to issue an order to restructure an undercapitalized bank and the publication of the Governance and Corruption Diagnostic Assessment report – the latter cost the government political capital.
The $1.1 billion is the third tranche of the $7 billion economic stabilization package, approved on the basis of Pakistan’s economic performance during the January-June period of the last fiscal year.
But to pave the way for approval and continuation of the programme, the board accepted Pakistan’s request for exemptions for missing some conditions for the end-June period and also relaxed at least three conditions for the next review.
