Farmane-Ilahi

ISLAMABAD (92 News) Pakistan has reached a staff-level agreement with the International Monetary Fund (IMF), unlocking a $2.3 billion financial package.

The deal includes a $1 billion tranche under Pakistan’s ongoing $7 billion Extended Fund Facility (EFF) and a new $1.3 billion arrangement under the IMF's Resilience and Sustainability Facility (RSF).

The agreement follows extensive discussions between Pakistani authorities and the IMF, which took place in Karachi and Islamabad between February 24 and March 14, 2025.

Pending approval from the IMF’s Executive Board in May, the first disbursement of $1 billion will be made, bringing the total disbursements under the EFF to $2 billion.

The IMF has commended Pakistan for its progress in stabilising the economy, noting a significant decline in inflation and improvements in fiscal discipline.

However, the Fund warned that external risks such as geopolitical tensions, commodity price fluctuations, and climate-related challenges could undermine the country’s stability.

The RSF arrangement will support climate resilience projects, including water resource management, renewable energy initiatives, and efforts to reduce urban pollution.

Pakistan's government has committed to further fiscal reforms, including measures to widen the tax base, phase out energy subsidies, and strengthen monetary policy.

With inflation at its lowest level since 2015, the agreement marks a key step in Pakistan’s long-term economic recovery and sustainability.