The global lender approved disbursement of $1.1 billion to crisis-hit Pakistan, marking the conclusion of Islamabad’s second bailout package in the last 8 years. IMF’s nod come at a significant cost, leading to severe inflation and slowing economy.
Pakistan will receive loan payment later this week, which will be the third and final installment of a $3 billion Stand-By Arrangement (SBA) with the IMF. This arrangement, agreed upon last summer to avert a sovereign default, is scheduled to expire this month.
Following meeting between Prime Minister Shehbaz Sharif and IMF Managing Director Kristalina Georgieva in Riyadh, it was reported that Islamabad is considering entering a new program with the IMF.
The country is now aiming for a larger loan program, ranging from $6 billion to $8 billion, spanning three to four years. An IMF team is expected to visit Islamabad next month to discuss the terms and conditions.
In addition to the Extended Fund Facility (EFF), Pakistan is also seeking additional funding under climate financing. This request is yet to be approved but will be discussed during the upcoming talks.
