The Prime Minister’s Office (PMO) in Pakistan has announced that the International Monetary Fund (IMF) on Friday, May 9, approved the first review of Pakistan’s $7 billion Extended Fund Facility (EFF), clearing the immediate disbursement of $1 billion to the country. The approval comes at a time of heightened regional tensions, with Pakistan and India trading accusations over recent cross-border hostilities and the IMF facing pressure from New Delhi to reassess its lending to Islamabad.
In a statement, the Pakistan PMO said, “Prime Minister Shehbaz Sharif expressed satisfaction over the approval of a USD 1 billion instalment for Pakistan by the IMF and the failure of India’s high-handed tactics against it.”
Earlier in the day, India had to review its financial assistance to Pakistan, raising concerns that the debt financing provided under IMF programs could be misused for state-sponsored terrorism. A terror attack in the Pahalgam region of Indian-administered Kashmir had led to the murder of 26 civilians on April 22, following which India launched targeted strikes on what it described as “Pakistan’s terror camps,” leading to a spike in military skirmishes between the two nuclear-armed neighbours.
The PMO said Pakistan’s economic situation had improved and the country was moving towards development, signalling confidence in the government’s current trajectory under the IMF program.
The IMF has not yet issued a public statement on the EFF disbursement, or the status of the proposed $1.3 billion Resilience and Sustainability Facility (RSF) for Pakistan, aimed at long-term economic reforms over more than two years.
