The IMF’s Executive Board is scheduled to meet on May 9, during which a final decision will be made regarding the disbursement of a $1.1 billion loan tranche to Pakistan.
This follows the staff-level agreement between the IMF and Pakistan reached in March, with the final approval expected in the upcoming meeting.
The announcement of the IMF board meeting had a positive impact on Pakistan’s stock market, which saw a slight recovery of 135 points following an initial dip of 500 points.
The PSX had opened on a bearish sentiment this week amid Pakistan-India tension after the deadly attack in Pahalgam area of Indian Illegally Occupied Jammu and Kashmir (IIOJK).
The IMF's agreement includes climate financing worth $1.3 billion, as well as an additional 28-month programme, which will bring the total financial support to Pakistan to $2.3 billion.
The IMF and Pakistani authorities have also agreed on the implementation of the Resilience and Sustainability Facility to address the country’s long-term challenges, including climate risks and energy sector reforms.
According to the IMF, Pakistan’s government has committed to continuing its economic reforms, including efforts to reduce public debt sustainably and improve resilience against natural disasters.
The IMF also highlighted the need for continued efforts to improve water usage and environmental goals, as well as plans for enhanced investment and budgetary measures to address climate challenges.
Despite improvements in economic activity, the IMF warned that risks to the country’s economy remain, including geopolitical tensions, rising global financial conditions, and fluctuations in commodity prices.
The IMF has stressed the importance of maintaining fiscal discipline, with emphasis on not exceeding the approved budget for the year.
Pakistan has assured the IMF that it will expand its unconditional cash assistance program under the Benazir Income Support Programme (BISP) and implement measures to save on energy subsidies.
Earlier, Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, has called for urgent international action on climate resilience and economic diversification during high-level engagements at the 2025 Spring Meetings of the World Bank Group (WBG) and the International Monetary Fund (IMF) in Washington, DC.
Speaking at the dialogue for the Fund for Responding to Loss and Damage (FRLD), Aurangzeb termed climate change an existential threat to Pakistan, citing the 2022 floods.
He urged the swift operationalisation of the Loss and Damage Fund with simple, agile, and accountable mechanisms to ensure timely disbursement to vulnerable countries.
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