The IMF has transferred USD 1.2 billion to Pakistan, Finance Minister Ishaq Dar said on Thursday, a day after the global lender approved a USD 3 billion bailout programme for the cash-strapped country.
The International Monetary Fund (IMF) gave a final nod to the USD 3 billion bailout programme on Wednesday to support the government's efforts to stabilise the country's ailing economy.
Addressing the media, Dar said when the Standby Arrangement (SBA) was finalised, it was decided that USD 1.2 billion would be given upfront while the "balance amount" of USD 1.8 billion would be handed over after two reviews in November and February.
"I want to share the information that the upfront payment of USD 1.2 billion, the IMF has transferred it to the State Bank of Pakistan's (SBP) account," he was quoted as saying by the Dawn newspaper.
The finance minister said that the IMF's Executive Board had approved the SBA with Pakistan and noted that this was a nine-month programme under which Islamabad would receive USD 3 billion, the Dawn newspaper reported.
The development came two weeks after the two sides reached a staff-level agreement over the stand-by arrangement (SBA).
The global lender on Wednesday said that the programme would focus on the "implementation of the FY24 budget to facilitate Pakistan's needed fiscal adjustment and ensure debt sustainability".
"The arrangement comes at a challenging economic juncture for Pakistan. A difficult external environment, devastating floods, and policy missteps have led to large fiscal and external deficits, rising inflation, and eroded reserve buffers" in the fiscal year 2023," Washington-based IMF said in the statement.
The finance minister said that the IMF funds would shore up Pakistan's foreign exchange reserves, noting that this would also include the USD 1 billion transferred by the United Arab Emirates a day earlier, the report said.
On Tuesday, Pakistan received USD 2 billion from Saudi Arabia, and a day later, it received USD 1 billion from the UAE.
Dar said there had been a USD 4.2 billion increase in the SBP's reserves during the week.
"So I am expecting that our forex reserves will close at USD 13-14 billion by tomorrow. The state bank will give the exact numbers," he was quoted as saying in the report.
He added that Pakistan went for a "smaller" SBA with the global lender instead of the ninth review of the loan programme.
"This (programme) has been limited to nine months so that whichever government comes into power after the elections can make its owns decisions," the minister said.
Pakistan's economy has been in a free fall mode for the last many years, bringing untold pressure on the poor masses in the form of unchecked inflation, making it almost impossible for a vast number of people to make ends meet.
Pakistan had been struggling to arrange enough foreign exchange to satisfy the IMF, which refused to provide the remaining USD 2.5 billion out of a USD 6.5 billion loan programme signed in 2019 and expired on June 30 this year.