The International Monetary Fund (IMF) has reached a staff-level agreement with Pakistan that could unlock around $1.21 billion in financing, subject to approval by the Fund’s Executive Board. The IMF Pakistan agreement covers reviews under two lending programmes and comes after discussions with Pakistani authorities.
If approved, Pakistan would receive about $1 billion under the Extended Fund Facility (EFF) and another $210 million through the Resilience and Sustainability Facility (RSF). The latest disbursement would bring total financing released under the two programmes to approximately $5.7 billion.
An IMF team led by Iva Petrova held discussions with Pakistani officials in Karachi and Islamabad between September 23 and October 7. The talks covered the latest programme reviews as well as the IMF’s 2026 Article IV consultation, which assesses the country’s broader economic conditions and policies.
The IMF said Pakistan maintained macroeconomic stability despite challenges linked to the Middle East conflict. Economic growth reached 4% during the first three quarters of fiscal year 2026, while full-year growth is estimated at 3.6%. Inflation eased to around 10.3% in September after reaching a peak in May.
Pakistan’s external position also showed improvement, according to the IMF. The country’s current account remained broadly balanced during FY26, helped by strong remittances. Foreign exchange reserves increased to around $21.5 billion by the end of September. However, the Fund warned that geopolitical tensions, energy price volatility and global financial conditions remained key risks.
Under the IMF Pakistan agreement, the Fund outlined several reform priorities for the country. These include firmly implementing the FY27 budget, targeting an underlying primary surplus of 2% of GDP, improving tax administration, expanding digital invoicing and strengthening public financial management.
The IMF also urged Pakistan to continue energy-sector reforms, maintain an appropriately tight monetary policy and allow exchange-rate flexibility. It called for stronger governance, progress on privatisation, improved oversight of state-owned enterprises and measures to reduce regulatory and trade barriers. The agreement must still receive Executive Board approval before the $1.21 billion can be released.
