Pakistan has received the third tranche of nearly $500 million from the International Monetary Fund (IMF) as part of the Extended Fund Facility, the State Bank of Pakistan has confirmed.
A tweet by the central bank announcing the development read: “SBP has received IMF tranche of US$ 498.7 million (equivalent to SDR 350 million)”.
#SBP has received IMF tranche of US$ 498.7 million (equivalent to SDR 350 million) under the Extended Fund Facility.
— SBP (@StateBank_Pak) March 30, 2021
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The tranche has resumed Pakistan’s $6 billion loan program which had been on hold since the outbreak of the COVID-19 pandemic in the country in February 2020. With the receipt of the latest tranche, Pakistan has received a total of around $2 billion under the loan program.
The tranche was released on the back of tough economic measures including the withdrawal of tax exemption worth Rs. 140 billion, an increase in electricity tariff, and a proposed amendment for the autonomy of the SBP which has been controversial.
Analysts said that the continuation of the IMF loan program has revived global investors’ confidence in Pakistan. This has paved the way for Pakistan to raise $2.5 billion from international markets through the sale of a 5 to 30-year Eurobond.
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The program has also helped the country to get another $10-12 billion each from the World Bank (WB) and the Asian Development Bank (ADB) over the next five years.
The fresh receipt including the issuance of Eurobonds that fetched over $2.5 billion. This has helped to strengthen the value of the Rupee against the Dollar which is hovering between Rs. 151 and 152. Consequently, the country’s foreign exchange reserves and the current account position will now improve further.
