Washington:
The International Monetary Fund (IMF) board of governors has given the green light to a $1.1 billion loan tranche for Pakistan, signaling the completion of the second bailout package, ARY News reported.
This latest financing marks the third and final tranche of a $3 billion standby deal with the IMF, which is crucial for Pakistan to avoid a sovereign default, especially as the existing deal expires this month.
After discussions in Washington, the IMF Board of Governors approved Pakistan's request for the release of funds. Insiders suggest that Pakistan can expect the loan disbursement soon, probably as soon as tomorrow (Tuesday), after approval from the IMF, as reported by ARY News.
Last month, Pakistan and the IMF reached a staff-level agreement on the final revision of the $3 billion bailout package. The country has already received two tranches totaling $1.9 billion, of which $1.2 billion was disbursed in July and another $700 million in January 2024.
Looking ahead, Pakistan is looking forward to a new, more substantial IMF loan with a longer term. Finance Minister Muhammad Aurangzeb has indicated that Islamabad could reach a staff-level agreement on the new program as early as July.
The focus is on securing a loan with a term of at least three years to strengthen macroeconomic stability and implement much-needed structural reforms. However, the exact scope of the program remains unknown.
This development follows Pakistan Prime Minister Shehbaz Sharif's meeting with IMF Managing Director Kristalina Georgieva, where he reaffirmed his government's commitment to revive Pakistan's economy.
At the meeting, held on the sidelines of the World Economic Forum Special Meeting, the Prime Minister emphasized his government's commitment to implementing structural reforms, ensuring fiscal discipline and pursuing sensible policies for sustainable economic growth.
In gratitude, the Prime Minister thanked Georgieva for the IMF's support in securing the $3 billion Standby Arrangement last year, ARY News reported.
(Except for the headline, this story has not been edited by DailyExpertNews staff and is published from a syndicated feed.)