Ishaq Dar, Pakistan’s finance minister, announced on Thursday that the IMF has sent $1.2 billion to Pakistan, a day after the international lender had authorised a $3 billion bailout scheme for the cash-strapped nation.
The $3 billion bailout scheme was given final approval by the International Monetary Fund (IMF) on Wednesday in order to aid the government’s initiatives to sustain the faltering national economy.
Speaking to the media, Dar claimed that when the Standby Arrangement (SBA) was decided upon, it was decided that $1.2 billion would be supplied immediately and the “balance amount” of $1.8 billion would be given after two reviews in November and February.
“I want to share the information that the upfront payment of $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 SBA with Pakistan had been approved by the IMF’s Executive Board, according to the finance minister, who also underlined that it was a nine-month plan with a $3 billion payment to Islamabad, according to the Dawn newspaper.
Two weeks had passed since the two parties’ agreement at the staff level regarding the stand-by arrangement (SBA).
According to the statement made by the international lender on Wednesday, the plan would concentrate on “implementing the FY24 budget to facilitate Pakistan’s necessary 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.
According to the report, the finance minister claimed that the IMF monies will strengthen Pakistan’s foreign exchange reserves and noted that this would also apply to the USD 1 billion transfer by the United Arab Emirates a day earlier.
Pakistan received $2 billion from Saudi Arabia on Tuesday, and $1 billion from the UAE the following day.
Dar reported that the SBP’s reserves rose by $4.2 billion during the course of 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.
