Key Points
- Transfers include tranches under the Extended Fund Facility and the Resilience and Sustainability Facility for the climate fight.
- Inflows strengthen Pakistan’s foreign exchange reserves
ISLAMABAD: Pakistan has received about $1.3 billion from the International Monetary Fund (IMF) under its ongoing financial support programmes, the State Bank of Pakistan (SBP) confirmed on Wednesday.
The latest funds have strengthened Pakistan’s foreign exchange reserves. Pakistan’s liquid foreign exchange reserves are expected to rise above $22.5 billion after the latest IMF disbursement, according to the latest State Bank of Pakistan (SBP) data and the newly received $1.3 billion inflow.
According to the latest SBP figures available before the IMF transfer, the country’s total liquid foreign reserves stood at $21.269 billion, including $15.828 billion held by the central bank and $5.441 billion held by commercial banks.
After adding the IMF inflow of about $1.3 billion, SBP-held reserves are projected to rise to around $17.1 billion, lifting overall liquid reserves to approximately $22.6 billion. This position is subject to routine external payments and valuation adjustments.
The central bank said it had received Special Drawing Rights (SDR) 914 million following the IMF Executive Board’s approval of the latest review under Pakistan’s Extended Fund Facility (EFF), along with support under the Resilience and Sustainability Facility (RSF).
The funds are expected to be reflected in the SBP’s foreign exchange reserves for the week ending May 16, according to the central bank.
The latest IMF receipts carry added significance at a sensitive moment for Pakistan’s economy. The country’s elevated external financing needs, volatile global oil prices, and persistent geopolitical uncertainty in the region enhance their importance even more.
The inflows provide immediate support to the central bank’s reserve buffers and help ease pressure on the Pakistani rupee.
Beyond strengthening the country’s ability to meet import and debt-repayment obligations, they would also bolster investor confidence at a time when markets remain highly sensitive to external-sector risks.
Economists also regard continued IMF backing as critical to unlocking additional financing from multilateral lenders, bilateral partners, and international capital markets. Above all, the IMF funds also influence long-term investment decisions.
Pakistan has relied on IMF support and financing from international partners to stabilise its economy. Weak investments and low export-based growth have left the country with severe balance- of-payments pressures, high external debt obligations, and a prolonged foreign exchange crisis in recent years.
The latest disbursement includes around $1.1 billion under the EFF programme and roughly $220 million from the IMF’s climate resilience facility.
The climate support funds are to back reforms related to climate adaptation and economic sustainability.
The South Asian nation has undertaken a series of fiscal and structural reforms under the IMF programme, including tighter budget management, energy sector adjustments, and measures to improve revenue collection.
Economists view the latest inflow as important for maintaining external sector stability and supporting investor confidence. However, they warn that Pakistan continues to face challenges from weak growth, inflation risks, tax base challenges, and large financing requirements.
