The International Monetary Fund (IMF) said on Friday that its Executive Board approved funds for Pakistan after the country “met all the objectives” under the extended background program (EFF), and added that the loan program for Islamabad was only for the stabilization of foreign exchange reserves and not related to budget financing.
Despite the Indian attempts to derail the Pakistan loan program, the IMF approved the immediate disbursement of around $ 1 billion to Pakistan under the ongoing EFF and allowed an additional agreement for the installation of resistance and sustainability of $ 1.4 billion (RSF).
During a press conference at Washington DC, the director of the IMF of the Communications Department, Julie Kozack, said: “Our Board discovered that Pakistan had met all the objectives. He had progressed in some of the reforms, and for that reason, the Board continued and approved the program.”
An Indian journalist asked the spokesman for the recent rescue package of the IMF to Pakistan, saying that “the Indian government has expressed a lot of disgust with Pakistan planning to use this package to build, remake, the areas that supposedly support cross -border terrorism.” He also asked a question related to the “majority vote that was received by approving this rescue package for Pakistan on May 9”.
Another journalist asked about the implications of the escalation between Pakistan and India in both economies, while another questioned that “safeguarding the IMF that their funds have to be used for military or in support of military actions.” The journalist also asked about the controversy about the termination of the executive director of the IMF of India, KV Subramanian.
In response to the questions, Kozack said the IMF Executive Board approved the EFF program of Pakistan in September 2024.
“The first review at that time was planned for the first quarter of 2025. And according to that timeline, on March 25, 2025, the IMF staff and the Pakistani authorities reached an agreement at the personnel level on the first review for the EFF,” he said.
He added that the agreement was later presented to the Executive Board of the Fund, which completed the review on May 9. “As a result of the completion of that review, Pakistan received the disbursement at that time,” he said.
Kozack explained that the world lender had a standard procedure under his programs that allowed his Executive Board to carry out periodic reviews of loan programs to evaluate the progress of the countries. The Board, said, in particular if the program was on its way, if the conditions were met under the program and if policy changes were needed so that the program returns to the track.
He then said that the Pakistan program was approved after the country successfully met all the required objectives.
Regarding the question about safeguards, he clarified that the financing of the IMF was provided to the members in order to solve paying problems, therefore, in the case of Pakistan, all the disbursements received under the EFF were assigned to the reserves of the Central Bank.
“Then, those disbursements are in the Central Bank, and under the program, these resources are not part of the financing of the budget. They do not transfer to the government to support the budget,” he said.
The IMF spokesman added that the program provides additional safeguards through conditionality that includes objectives on the accumulation of international reserves.
“It includes a zero objective, which means that there are no loans from the Central Bank to the Government. And the program also includes a substantial structural conditionality around improving tax management,” he said, added that any deviation from the established program conditions would affect future reviews.
Kozack said that the appointment and resignation of a member of the Executive Board was the prerogative of any country, and that it depended completely on the country’s authorities to determine who represented them in the background.
In the tension of Pakistan-India, Kozack expressed regrets and sympathies for the loss of lives and expected a peaceful resolution of the conflict.
Earlier this month, the IMF had approved two important financing agreements for the country: a disbursement of $ 1 billion under the EFF and a new RSF destined to support climate -related initiatives.
In a statement, the IMF said that its Executive Board completed the first review of the Pakistan Economic Reform Program supported by the EFF Agreement.
“This decision allows an immediate disbursement of around $ 1 billion (SDR or special drawing rights 760 million), which carries the total disbursements under the agreement to approximately $ 2.1BN (SDR 1.52BN). In addition, the IMF Executive Board approved the application of the authorities for an agreement under the RSF, with access to approximately $ 1.4BN (SDR 1BN),” he said.
He pointed out that Pakistan’s political efforts had already delivered a “significant progress” to stabilize the economy and the reconstruction of trust, in the midst of a challenging global environment.
“The fiscal yield has been strong, with a main surplus of two percent of the gross domestic product reached in the first half of fiscal year 2015, keeping Pakistan on the way to meet the final objective of the FY-FY25 of 2.1pc of GDP Pakista is reduced by a total of 1100. June 2025. Gross reserves were $ 10.3 billion at the end of April, compared to $ 9.4 billion in August 2024, and it is projected that they will reach $ 13.9 billion at the end of June 2025 and continue to be rebuilt through the average term. ”
Meanwhile, he said that the RSF would support the efforts of the authorities to reduce vulnerability to natural disasters and develop economic and climatic resilience.
The president of the President praises the role of the IMF program in the economic stability of Pakistan
In a separate development on Friday, President Asif Ali Zardari held a meeting with a delegation of the International Monetary Fund (IMF), led by the director of the Middle East and the Department of Central Asia Yhad Azour, highlighting the positive role of the fund in the promotion of economic development in developing nations.
Discussing the current economic situation of Pakistan and the current IMF program, the president recognized and appreciated the contribution of the IMF to Pakistan’s economic progress, according to the state of state. Associated Press of Pakistan (app).
The members of the delegation expressed satisfaction about Pakistan’s efforts for economic reforms and the implementation of the IMF program, which observed that it was progressing in the right direction.
“The delegation emphasized even more than the program helped reduce inflation and fiscal deficit and the strengthening of Pakistan currency reserves,” according to the report.
President Zardari thanked the IMF for his continuous support and cooperation with Pakistan and also appreciated the Ministry of Finance for his efforts to improve the national economy, he added.
A previous day, Prime Minister Shehbaz Sharif had also held a meeting with the delegation, reaffirming his government’s commitment to track accelerated institutional reforms along with macroeconomic stabilization, stating that Pakistan was now firmly on the road to economic development.
“Pakistan is now going from economic stability towards sustainable growth,” said the prime minister, emphasizing that the main priority of the government was not only to maintain macroeconomic gains but to issue comprehensive institutional reforms, crucial for long -term resistance.
Additional reports of Nadir Guramani.
