ISLAMABAD: In a major boost to Pakistan’s fragile economy, officials from the Ministry of Finance have expressed strong confidence that the country is now on track to receive the next tranche of funding from the International Monetary Fund, with “no obstacles remaining” after successfully meeting all required conditions.
According to senior finance ministry sources, Pakistan has fulfilled all commitments under the Extended Fund Facility (EFF) programme, paving the way for formal approval by the IMF’s Executive Board. The crucial board meeting is expected to take place in the first week of May, where a $1.2 billion tranche will be considered for disbursement.
Officials revealed that Pakistan has also secured assurances from friendly countries regarding the rollover of existing loans, a key requirement set by the IMF to ensure external financial stability. These assurances have significantly strengthened Pakistan’s case, eliminating concerns about immediate repayment pressures.
Currently, Pakistan holds substantial deposits from allied nations in the State Bank of Pakistan, including $5 billion from Saudi Arabia, $4 billion from China, and $3 billion from the United Arab Emirates. Sources indicated that discussions are ongoing to extend these deposits further, with expectations that the UAE will soon confirm the rollover of its upcoming dues.
Another critical development is the government’s approach to fuel subsidies. Officials confirmed that the IMF has been taken into confidence regarding targeted petroleum subsidies, a shift away from blanket relief measures. The government has assured the Fund that any subsidy will be carefully managed within the current fiscal framework to avoid additional economic strain.
“Consultation with the IMF was carried out before passing on the impact of rising global oil prices to consumers,” a source said, highlighting a more coordinated and transparent policy approach. The targeted subsidy will be financed through the current fiscal year’s budget, while a Rs300 billion contingency fund remains available to tackle unforeseen economic shocks.
In addition to the EFF tranche, Pakistan is also expected to receive around $210 million under the Resilience and Sustainability Facility (RSF), aimed at supporting climate-related initiatives and long-term economic resilience.
Economic experts view the anticipated IMF approval as a critical lifeline for Pakistan, helping stabilize foreign exchange reserves, restore investor confidence, and ensure timely external payments.
With all prior conditions met and international support aligned, the upcoming IMF board meeting is now seen as a formality—one that could provide Pakistan with much-needed financial breathing space amid ongoing global economic uncertainty.
