IMF Loan to Pakistan: The International Monetary Fund (IMF) has approved new loan assistance of about $ 1.2 billion to Pakistan under bilateral arrangement. This loan assistance clearly shows that the country has maintained stability despite the devastating floods.

The newspaper ‘Dawn’ reported in a news on Tuesday that the IMF Executive Board of Directors, in its meeting held in Washington on Monday, gave this approval under the dual ‘track bailout’, 37-month Extended Fund Facility (EFF) and climate-focused Sustainable Stability Facility (RSF).

Pakistan, which is facing cash crisis, is currently in the 24th program of IMF. Under this, last year it was agreed to provide assistance of seven billion dollars in a period of 39 months. The news said that under the latest approval, Pakistan is allowed to withdraw one billion dollars under EFF and $200 million under RSF.

IMF statement

“Given the uncertain global environment, Pakistan needs to maintain prudent policies to further strengthen macroeconomic stability,” Nigel Clarke, Deputy Managing Director and acting head of the IMF, said in the statement. At the same time, there is a need to accelerate the reforms necessary to achieve strong, private sector-led and sustainable medium-term growth.

Islamabad officials described the approval as a sign of confidence in Pakistan’s reform efforts and macroeconomic management, the newspaper reported. He also stressed that the real test will be to translate these commitments into concrete economic reforms.

IMF had expressed dissatisfaction

The IMF last month expressed dissatisfaction over Pakistan’s weak financial management, cash monitoring and accountability for public resource allocation and advised it to reduce personal and political misuse of taxpayers’ money.

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Pakistan’s economic condition has now deteriorated so much that it has to sell its government airline Pakistan International Airlines (PIA). Prime Minister Shehbaz Sharif has announced that the auction of this airline will be shown live on 23 December 2025. This decision has been taken in view of the strong pressure from the IMF and the tough conditions of the bailout package.

Four big names are involved in the race to buy PIA. Among these four, the most talked about is Fauji Fertilizer Company, which is directly linked to the Fauji Foundation, which is under the influence of the Pakistani Army. Considering the deep hold of the army in Pakistan’s politics and economy, it is believed that ultimately this airline may fall into the hands of the same group. The remaining contenders also include Lucky Cement Group, Arif Habib Corp and Air Blue Limited. This is the first time that Pakistan will show the bid of a government airline live publicly.

Economy survived only on IMF’s terms

Pakistan has been running on debt after debt for the last several years. In 2023, the country was almost on the verge of bankruptcy. Defense expenditure continued to increase and revenue continued to decline. The number of loans taken from IMF has exceeded 20, while the country’s own economic capacity is very low. IMF approved a bailout package of $7 billion, but kept the condition that Pakistan should reform government companies, reduce losses and privatize sinking companies like PIA.

How did PIA collapse?

PIA, which was once respected internationally, went into the depths of ruin due to its own mistakes. In 2020, it was revealed that the licenses of almost one-third of Pakistani pilots were fake or doubtful. After this revelation, Europe, Britain and America banned PIA flights. Along with this, corruption, political interference, kinship-based recruitment and crowding of non-essential employees completely ruined the airline. This company, which incurs losses of billions every year, became the biggest economic disease of Pakistan.

countries in debt

Pakistan has now reached a point where it has to take new loans even to repay the old loans. In such a situation, privatization of PIA has become a compulsion for it. Apart from fulfilling the conditions of IMF, Pakistan does not see any other option. In the coming years, it will be seen whether the country is able to stop its economic decline after selling PIA or not.

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Pakistan is going to get another big loan. On Wednesday (October 15, 2025), the Pakistani government and the International Monetary Fund (IMF) reached agreement on a staff-level agreement (SLA) on loan programs, paving the way for Pakistan to access a loan of US $ 1.2 billion.

According to PTI report, IMF will give one billion US dollars to Pakistan under its Extended Fund Facility (EFF) and after approval from the Executive Board of IMF, Pakistan will also be given $200 million under Resilience and Sustainability Facility (RSF). In this way he is going to get a total of 3.3 billion dollars.

The IMF mission led by Eva Petrova completed negotiations last week with Pakistani officials on the second review of the EFF agreed in 2024 and the first review of the RSF climate loan agreed this year. However, the mission returned from Pakistan without signing the staff level agreement.

Eva Petrova said in a statement issued on Wednesday (October 15, 2025) that the staff-level agreement is subject to the IMF’s Executive Board for approval. “With EFF’s support, Pakistan’s economic program is strengthening macroeconomic stability and regaining market confidence,” he said.

Noting the progress made on Pakistan’s policy priorities, he said, ‘Officials reaffirmed their commitment to EFF and RSF-supported programs and to maintaining sound and prudent macroeconomic policies while pursuing ongoing structural reforms.’

He said the State Bank of Pakistan (SBP) is committed to a prudent monetary policy stance to ensure that inflation remains within the target range of 5-7 per cent. On the issue of cyclical debt for the power sector, Eva Petrova said Pakistan is committed to curbing its accumulation through timely tariff adjustments, which will ensure cost recovery and maintain a progressive tariff structure.

Pakistan, which is facing poverty, starvation and economic crisis, has once again pleaded with the International Monetary Fund (IMF) for a new debt. The Mission of IMF will remain in Pakistan for two weeks and will see if Pakistan is improving its economy. If the mission seems to improve, then it will give a new loan to Pakistan.

Pakistani newspaper The Dawn said on Tuesday (September 30, 2025) that the IMF mission held a formal meeting with Pakistan’s economic party. It reviewed the implementation of seven billion dollars loans and $ 1.1 billion facility.

According to the news, this meeting was held at a time when the performance of the program has been mixed by the end of June 2025 (which is under review). In the IMF, a team led by Pakistan’s mission head Eva Petrova met the Pakistani delegation led by Finance Minister Mohammad Aurangzeb on Monday.

The meeting was attended by prominent economic stakeholders, including Governor, Finance Secretary and Chairman of the Board of Federal Revenue (FBR), State Bank of Pakistan. The mission will remain in Pakistan for about two weeks and will review the implementation of an extended financing facility (EFF) of seven billion US dollars and a flexible and stable facility (RSF) of US $ 1.1 billion.

The report stated that the Government of Pakistan has asked the IMF mission to take into account the damage in the flood, but sources said that the review is based on the goals before the flood. Due to this, the government is accountable about the demonstrations till the end of June-2025. However, it can be considered later on exemption on the damage caused by floods. The report said that if this meeting is positive, then next month Pakistan will be eligible for the distribution of about $ 1 billion.

The IMF gave a loan of one billion dollars to Pakistan in May this year. The IMF had put several conditions in front of Pakistan before giving this loan, including carbon levy. Apart from this, the conditions of improvement in electricity fees from time to time and improvement of water prices were also included at many levels.

International Monetary Fund: Pakistan was given a financial assistance of $ 1 billion recently under the International Monetary Fund (IMF) under an extended fund facility of $ 7 billion. Apart from this, funding of $ 1.4 billion was also given under the Climate Rejylines Loan Program. Now according to the report of Reuters, Pakistan can get a loan again from the IMF. It has also been confirmed by the International Monetary Fund that the next funding for Pakistan is to be reviewed in the second half of 2025.

This is Pakistan’s goal regarding economy

On behalf of the IMF, it has been said that their top project is to keep inflation in the Medium Term Target Range of State Bank of Pakistan 5-7 percent. Its purpose is focused on the ongoing economic stabilization efforts in the country.

According to the IMF, Pakistani officials have also expressed their commitment to managing the country’s revenue properly. Under this strategy, the government there is carrying a target of keeping GDP surplus 1.6 percent in FY 2026. To achieve this, it is necessary to ensure massive economic stability. GDP surplus means production in the economy, being higher than consumption.

IMF completed Pakistan’s staff tour

IMF is helping Pakistan in this era of increasing inflation, declining foreign reserves, declining local currency in this era of economic upheaval so that the falling economy there can be brought back on track.

The IMF also said on Saturday that they completed their staff tour of Pakistan. During this period, Pakistan officials were discussed with the budget proposal of FY 2026, economic policy, reforms from funding. The IMF has also talked with Pakistani officials to continue the matter towards agreed on the budget in the coming days.

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