Pakistan has received a significant financial boost at a critical time, as the State Bank of Pakistan (SBP) confirmed an inflow of US$1.2 billion from the International Monetary Fund (IMF). The disbursement has arrived under the Fund’s Extended Fund Facility (EFF) and the Resilience and Sustainability Facility (RSF), two programs designed to support economic reforms and strengthen resilience against long-term challenges.
This development marks an important milestone in Pakistan’s ongoing efforts to stabilize its economy, rebuild confidence, and strengthen its foreign exchange reserves.
IMF Completes Second Review, Approves Major Disbursement:
On 8 December 2025, the IMF Executive Board completed the second review of Pakistan’s Extended Fund Facility. Following the review, the Board approved:
• SDR 760 million under the EFF
• SDR 154 million as the first tranche under the RSF
These approvals came after months of technical discussions and policy negotiations between Pakistan and the IMF teams in Karachi, Islamabad, and Washington, led by mission chief Iva Petrova.
As a result, Pakistan received a total of SDR 914 million, equivalent to roughly US$1.2 billion, on 10 December 2025.
Why This IMF Inflow Matters for Pakistan’s Economy:
For a country grappling with sluggish economic growth, high inflation, and persistent foreign exchange shortages, the IMF’s financial support acts as a critical stabilizing anchor.
Pakistan has been relying on IMF programs to restore macroeconomic stability, and earlier entered a short-term Stand-By Arrangement (SBA) to keep its economic framework intact while introducing necessary structural reforms. These reforms include restoring fiscal discipline, stabilizing the exchange rate, improving energy-sector management, and strengthening governance.
A Much-Needed Boost for Reserves and Stability:
The fresh IMF funds are expected to:
• Strengthen Pakistan’s foreign exchange reserves
• Reduce pressure on the balance of payments
• Improve confidence in the country’s external financing outlook
• Provide breathing room for the government to manage debt repayments
• Support financial markets by enhancing currency stability
For businesses, investors, and financial institutions, this inflow signals greater short-term predictability and reduced volatility, key ingredients for economic planning and investment decisions.
Looking Ahead: Cautious Optimism for 2026:
While the IMF inflow provides immediate relief, Pakistan’s long-term economic stability will depend on consistent implementation of reforms, improved export competitiveness, and sustained investor confidence.
But for now, the US$1.2 billion boost offers a timely cushion and a clearer path as the country moves toward economic recovery.