Pakistan has received $1.2 billion from the International Monetary Fund (IMF) following the Executive Board’s approval, the State Bank of Pakistan (SBP) announced on Thursday. The funds were transferred under the IMF’s Extended Fund Facility (EFF) and the Resilience and Sustainability Facility (RSF), with the amount to be reflected in SBP’s foreign exchange reserves for the week ending December 12, 2025. The IMF approved the tranche on December 8 after completing the second review of Pakistan’s economic reform program under the EFF and the first review under the RSF. Following the approval, IMF Deputy Managing Director and Acting Chair Nigel Clarke said Pakistan’s reforms under the EFF have helped maintain macroeconomic stability despite recent shocks. He noted that real GDP growth has accelerated, inflation expectations have stayed anchored, and fiscal and external imbalances have moderated. Clarke emphasized the need for Pakistan to continue prudent policies to strengthen macroeconomic stability while advancing reforms to support private sector-led, sustainable growth. He also praised the authorities’ commitment to the FY2026 primary balance target amid recent severe floods and stressed the importance of revenue-raising reforms through tax policy simplification and base broadening to support fiscal sustainability, climate resilience, social protection, human capital development, and public investment. He highlighted the importance of a tight monetary policy to keep inflation within SBP’s target range, improvements in central bank communication, deepening the interbank foreign exchange market, and allowing exchange rate flexibility. Finally, Clarke stressed that strong financial regulation enforcement is essential for a sound, well-capitalized financial sector, and promoting capital market development will expand financing options for both public and private sectors. “Efforts to advance structural reforms should continue to unlock growth potential and attract high-impact private investment. To this end, the publication of the Governance and Corruption Diagnostic report is a welcome step in accelerating governance reforms. Additional efforts should focus on SOE governance reforms and privatisation, enhancing the business environment and improving economic data and statistics,” read the statement. Following the loan approval, Prime Minister Shehbaz Sharif had said that the IMF financial announcement highlights Pakistan’s progress in implementing the measures necessary for economic stability and growth. In a statement, he added that the IMF’s acknowledgement of the effective execution of economic reforms and initiatives in Pakistan is a clear recognition of the hard work of Finance Minister Muhammad Aurangzeb and his team.
Pakistan secures $1.2 billion IMF tranche after Executive Board approval
