Pakistan to get IMF nod to utilise $2.78b

The International Monetary Fund (IMF) has agreed to allow Pakistan to utilise $2.78 billion, equivalent to Rs500 billion, to meet its budgetary side requirements, which were provided to it to combat the COVID-19 pandemic.

The IMF usually provides Balance of Payment (BoP) support to recipient countries, but in special cases, it allows countries to utilise its resources to finance budgetary requirements as well.

according to media reports, the request made by Pakistan, the IMF agreed in principle, and an announcement for it is expected along with the approval of the $1 billion tranche under the pending sixth review of an Extended Fund Facility (EFF). The commercial banks are eyeing to provide T-bills financing at higher rates, so the provision of budgetary support of Rs500 billion will spoil dreams of earning lofty profits.

“The Ministry of Finance has made a request to the IMF to allow utilisation of $2.78 billion windows provided to fight the COVID-19 pandemic for the purpose of meeting financing of budgetary requirements,” top official sources confirmed while talking to The News on Tuesday and indicated that the Fund staff had agreed to extend this major favour to Pakistan.

Pakistan had received $2.78 billion from the IMF under the Special Drawing Rights Program as the Fund announced $650 billion programmes for low-income countries severely hit by the pandemic.