Source : INDIA TODAY NEWS
The International Monetary Fund has reached a preliminary agreement with Pakistan that could unlock about USD 1.2 billion in fresh funding. The amount includes USD 1 billion under the IMF’s main loan programme and another USD 210 million under a separate programme meant to help Pakistan deal with climate and other long-term risks.
The staff-level agreement was reached after extensive talks between an IMF team led by Iva Petrova and Pakistani authorities, the lender said in a statement from Washington. The agreement still needs approval from the IMF Executive Board and, if cleared, would take total disbursements under the two programmes to about USD 5.7 billion.
advertisement
A staff-level agreement is a provisional understanding between a member country’s government and an IMF negotiating team. According to Petrova, the agreement was reached on the fourth review of the 37-month Extended Fund Facility and the third review of the 28-month arrangement under the Resilience and Sustainability Facility.
“Upon approval, Pakistan will have access to about USD 1.0 billion (SDR 760 million) under the EFF and about USD 210 million (SDR 154 million) under the RSF, bringing total disbursements under the two arrangements to about USD 5.7 billion,” Petrova said.
She said that, with support from the EFF, Pakistan had successfully managed the impact of the West Asia conflict and that strong policies had helped preserve macroeconomic stability. Real GDP growth reached 4 per cent in the first three quarters of FY26, and although higher energy prices and supply disruptions weakened momentum somewhat, FY26 growth is estimated at 3.6 per cent.
“Headline inflation, after peaking in May, moderated to about 10.3 per cent in September, while core inflation remained contained,” she said. Petrova added that the current account was broadly balanced in FY26, helped by strong remittances, while gross reserves rose to about USD 21 billion by the end of September. She also said sovereign rating upgrades and renewed international market access pointed to stronger policy credibility, but warned that risks remained high, particularly from geopolitical tensions, volatile energy prices, tighter global financial conditions and trade disruptions.
In sum, the IMF’s preliminary agreement could give Pakistan about USD 1.2 billion in additional funding, subject to board approval, while the lender said the country’s recent economic indicators had improved even as major external risks remained.
With PTI Inputs
– Ends
SOURCE :- TIMES OF INDIA
