In a much-needed boost to Pakistan’s economy, the International Monetary Fund (IMF) has injected a substantial sum of $1.2 billion into the State Bank of Pakistan (SBP), according to an announcement made by Finance Minister Ishaq Dar. This significant deposit comes as welcome relief amidst the country’s struggles with a shortage of dollars and soaring inflation.
During a news briefing, Minister Dar revealed that the IMF had made an upfront payment of $1.2 billion, following the approval of a Stand-By Arrangement (SBA) by the IMF Executive Board the previous night. Under this agreement, Pakistan will receive an initial installment of $1.2 billion, with the remaining $1.8 billion to be disbursed after two upcoming reviews scheduled for November and February.
Minister Dar expressed optimism about the positive impact of this deposit on the foreign exchange reserves, anticipating an increase of $4.2 billion in the SBP reserves by the end of the week. He further projected that Pakistan’s reserves would reach $14 billion by the following day, bolstering the country’s financial stability.
Acknowledging the role of Prime Minister Shehbaz Sharif in engaging with the IMF, Minister Dar commended the successful negotiation of the SBA. Notably, the SBA has been limited to a duration of nine months, allowing the future government, to be formed after elections, the flexibility to make its own decisions.
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This recent development follows Saudi Arabia’s deposit of $2 billion and the United Arab Emirates’ contribution of $1 billion to the SBP earlier this week. These combined efforts from international partners aim to alleviate Pakistan’s precarious position on the verge of default and facilitate economic stability. The IMF’s SBA, along with the support from Saudi Arabia and the UAE, is expected to provide immediate relief by stabilizing the economy and creating space for social and development spending to benefit the people of Pakistan.
As Pakistan strives to navigate its economic challenges, the infusion of funds from multiple sources signifies a positive trajectory. Minister Dar emphasized the need to consolidate these gains and continue on the path of progress, underscoring the importance of sustained efforts to secure Pakistan’s financial future.
