SBP receives first installment of $1.26bn loan from IMF

KARACHI, SEP 28 (DNA) : The State Bank of Pakistan (SBP) has received the first installment of loan from the International Monetary Fund (IMF).

According to sources, Pakistan has received $1.269 billion as part of the $7 billion loan agreement.

The funds have been transferred to the SBP ‘s account. The central bank has confirmed the receipt of the instalment, and Pakistan’s foreign exchange reserves have increased by $1 billion.

The Fund on Wednesday approved the much-awaited $7 billion Extended Fund Facility (EFF) for Pakistan.

The decision was made during an Executive Board meeting chaired by IMF Managing Director Kristalina Georgieva in Washington, with Pakistan’s agenda at the forefront.

Earlier, it was expected that Pakistan would receive the first tranche of $1.1 billion by Sept 30.

Following the approval of the loan programme, the second tranche is also anticipated within the same fiscal year, with the IMF loan being provided at an interest rate of less than 5 per cent.

The Extended Fund Facility loan programme was agreed upon between Pakistan and the IMF on July 12 last.

With the approval of the loan, Pakistan’s economic and foreign exchange reserves are expected to improve, and the pressure of payments on Pakistan will decrease.

Earlier, Prime Minister Shehbaz Sharif told media after a meeting with Turk President Tayyip Erdogan that Islamabad had met strict conditions of the IMF and hoped that it would get fiscal assistance to stabilise the country’s economy.