Islamabad (Web Desk/Agencies) Finance Minister Ishaq Dar on Thursday stated that the International Monetary Fund (IMF) has transferred $1.2 billion to the State Bank of Pakistan (SBP).
The statement by the finance minister comes a day after the IMF Executive Board approved the $3 billion bailout package for Pakistan.
The globla lender approved the package under a 9-month Stand-By Arrangement (SBA) for Pakistan.
“Today, the Executive Board of the International Monetary Fund (IMF) approved a 9-month Stand-By Arrangement (SBA) for Pakistan for an amount of SDR2,250 million (about $3 billion, or 111 percent of quota) to support the authorities’ economic stabilization program,” the IMF said in a statement.
Islamabad signed a short-term IMF deal on June 30 under which the country will receive $3 billion over nine months, subject to approval by the IMF's board.
In a televised address, the finance minister said that the balance amount of $1.8 billion would be provided after two reviews that would be held in November 2023 and February 2024.
Dar said that the IMF funds would help improve foreign exchange reserves, adding that in total around $4.2 billion were added to the country’s reserves during the week.
These include $2 billion from Saudi Arabia, $1 billion from United Arab Emirates (UAE) and $1.2 billion from IMF.
The SBP would issue the exact figures on Friday he said adding that the reserves are expect to reach between $13 to $14 billion.
The finance minister thanked Prime Minister, Shehbaz Sharif and his economic team for their untiring efforts made during the past eight months in materializing the programme.
He said that the agreement was limited to 9 months to enable new elected government to take decisions for future.
"Pakistan is going forward in positive direction and highlighted that there was need to consolidate the gains and take the economy to growth trajectory," Dar said.
It is pertinent to mentioned here that the IMF Executive Board had approved the Stand-by Agreement (SBA) for $ 3 billion for Pakistan.
The staff level agreement on SBA amounting Special Drawing Rights (SDR) 2,250 million (about $3 billion or 111 percent of Pakistan’s IMF quota) was reached during the last week of June after IMF staff team led by Nathan Porter held in person and virtual meetings with the Pakistani authorities to discuss a new financing engagement for Pakistan under the arrangement.
The new SBA builds on the authorities’ efforts under Pakistan’s 2019 Extended Fund Facility supported program, which was due to expire in end-June.
According to statement issued by IMF, 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 FY23.