Pakistan clears IMF review, to receive $1b

ISLAMABAD: The International Monetary Fund (IMF) executive board approved on Friday the first review of its $7 billion programme with Pakistan, freeing $1 billion in cash, the Pakistani government said on Friday.

“Prime Minister Muhammad Shehbaz Sharif expresses satisfaction over the approval of a $1 billion tranche by the International Monetary Fund (IMF) for Pakistan,” his office said in a statement.

The IMF board was scheduled to discuss both the review of the $7 billion programme and a new sustainability loan for $1.3 billion over more than two years.

The fund did not immediately respond to a request for comment.

The announced approval comes after India asked the IMF to review its loans to Pakistan, following an April attack on Hindu tourists in Indian Kashmir that killed 26 and triggered the worst fighting between the nuclear-armed neighbors in nearly three decades.

In a recent move, India had also terminated Dr Krishnamurthy Subramanian as a board member and Executive Director (India) at the IMF, seemingly in an attempt to interfere with the scheduled IMF meeting on May 9.

However, the Indian pressure, as expected, could not affect the IMF Executive Board approval, as Pakistan is already part of the programme. The country has fulfilled all prerequisites and secured staff-level approval without any additional conditions.

The staff-level agreement on both programmes was reached before the current hostilities rose. Pakistan and India accused each other on Friday of launching drone and artillery attacks overnight as tourists and villagers fled.

The review approval brings disbursements to $2 billion within the $7 billion programme.