Pakistan has received a $1 billion tranche from International Monetary Fund (IMF), boosting the country’s foreign exchange reserves and supporting its ongoing economic stabilization.
Confirming the receipt of the funds, the State Bank of Pakistan (SBP) said it was part of the $7 billion Extended Fund Facility (EFF) inked between Islamabad and the global lender last year. The government has thus far received $2 billion from the donor agency.
The IMF’s Executive Board approved the latest tranche on May 9 following a staff-level agreement between the lender and Pakistan. Additionally, the Board approved a new Resilience Sustainability Facility (RSF) regarding climate funding worth $1.4 billion.
In a statement issued after the approval, the IMF said Pakistan’s policy efforts under the EFF have already delivered significant progress in stabilizing the economy and rebuilding confidence amidst a challenging global environment. It noted that fiscal performance has been strong, with a primary surplus of 2% of GDP achieved in the first half of FY25, keeping Pakistan on track to meet the end-FY25 target of 2.1% of GDP.
Inflation fell to a historic low of 0.3% in April, and progress on disinflation and steadier domestic and external conditions have allowed the SBP to cut the policy rate by 1100 bps since June 2025. Gross reserves stood at $10.3 billion at end-April, up from $9.4 billion in August 2024, and are projected to reach $13.9 billion by end-June 2025 and continue to be rebuilt over the medium term.