The International Monetary Fund (IMF) authorised a 9-month Stand-By arrangement of USD 3 Billion for Pakistan on Wednesday to support the country’s economic stabilisation programme, according to Pakistan-based Geo News.
$3 Billion Loan for Cash-Starved Pakistan
According to an IMF release, “Today, the Executive Board of the International Monetary Fund (IMF) approved a 9-month Stand-By Arrangement (SBA) for Pakistan in the amount of SDR 2,250 million (about USD 3 billion, or 111 per cent of quota) to support the authorities’ economic stabilisation programme.”
Earlier in June, Pakistan and the IMF struck a USD 3 billion staff-level agreement (SLA), providing much-needed respite to the cash-strapped government. The IMF statement came after Pakistan Finance Minister Ishaq Dar stated that Pakistan has received USD 1 billion from the UAE as part of its financial commitment to assist Pakistan in receiving the IMF rescue package.
“We have received USD 1 billion from the UAE,” Ishaq Dar stated in a televised address on Wednesday. “The UAE has deposited the funds into the State Bank account,” according to Geo News. Earlier on Tuesday, Ishaq Dar said that Saudi Arabia had deposited USD 2 billion in the account of the State Bank of Pakistan to help strengthen Pakistan’s foreign reserves.
According to Geo News, Pakistan signed a short-term IMF agreement on June 30 under which Islamabad will receive USD 3 billion over nine months, subject to approval by the IMF’s board. According to Geo News, after months of delays, cash-strapped Pakistan obtained the IMF bailout package after implementing difficult economic measures such as hiking interest rates and increasing taxes to meet IMF demands.
Pakistan Prime Minister Shehbaz Sharif has described the IMF’s SBA clearance as a significant step forward in the government’s attempts to stabilise the country’s economy. He emphasised that the IMF’s decision strengthens Pakistan’s economic position while it faces economic challenges. He thanked IMF Managing Director Kristalina Georgieva for her assistance.
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