IMF board meets, expected to approve $1.2 billion tranche for Pakistan

ISLAMABAD: The International Monetary Fund’s Executive Board has convened a key meeting, with Pakistan expected to secure approval for the next $1.2 billion tranche under its ongoing lending programme, official sources said.

The approval would follow recent progress under Pakistan’s reform commitments, with authorities stating that the country has already met all required conditions under the IMF programme.

According to officials, the Board is also expected to approve the third review under Pakistan’s Extended Fund Facility (EFF) as well as the second review of the Resilience and Sustainability Facility (RSF), which focuses on climate-related reforms.

A staff-level agreement between Pakistan and the IMF was reached on March 27, paving the way for the next disbursement.

Finance ministry sources said petroleum levy collections were projected to exceed the Rs1,468 billion target, while the government was also considering further increases in the levy as part of fiscal consolidation efforts.

The IMF has continued to press Pakistan to phase out subsidies, while the government has pointed to recent macroeconomic stabilisation and a decline in inflation as signs of economic improvement.

Officials said risks to the outlook remained due to heightened geopolitical tensions in the Middle East, though Pakistan had assured the Fund of its commitment to maintaining fiscal discipline.

The IMF board decision, once finalised, would be a key step in unlocking external financing for Pakistan’s struggling economy, which remains under pressure from high debt servicing needs and limited foreign exchange reserves.