IMF Set to Approve $1.2 Billion Financing for Pakistan

ISLAMABAD: The International Monetary Fund’s (IMF) Executive Board is scheduled to meet today to consider approving $1.2 billion in financing for Pakistan, following a staff-level agreement reached in October on the country’s ongoing loan programmes.

If approved, Pakistan will receive about $1 billion under the Extended Fund Facility (EFF) and an additional $200 million through the Resilience and Sustainability Facility (RSF), which also supports climate-related projects.

An IMF team, led by Iva Petrova, held discussions in Karachi, Islamabad, and Washington from late September to early October to finalise the agreement. The IMF highlighted Pakistan’s robust programme implementation and key priorities, including maintaining fiscal discipline, supporting flood-affected households, keeping inflation within the State Bank of Pakistan’s target, restoring energy sector viability, and advancing structural reforms.

Read more: IMF Board to Review Pakistan’s Progress Tomorrow

The IMF also noted progress on climate initiatives backed by the RSF, emphasizing that recent floods highlight the need for ongoing reforms to reduce climate risks.

Ahead of the Board meeting, the IMF released its Governance and Corruption Diagnostic report, warning that persistent corruption and weak institutions continue to undermine economic development, despite stabilisation under the EFF. The report stated that political and economic elites often obstruct development by capturing public resources for personal gain, while ordinary citizens frequently face demands for unofficial payments to access basic services.