The International Monetary Fund (IMF) has agreed to give Pakistan a loan of $7 billion to help with its financial difficulties. The country will receive the first $1 billion right away, and the rest will come over the next three years.
Prime Minister Shehbaz Sharif expressed his gratitude to the IMF’s leader, Kristalina Georgieva, for this support. Pakistan has been dependent on IMF loans for many years and is currently the fifth-largest borrower from the IMF, having taken more than 20 loans since 1958.
The IMF noted that this new program will require Pakistan to implement solid policies and reforms to stabilize its economy. Pakistan has promised that this will be the last loan from the IMF, which is a significant commitment. As part of the agreement, the government has accepted some unpopular decisions, such as raising taxes on individuals and businesses.
For decades, Pakistan has struggled with financial issues, and last year it nearly defaulted on its debts, having only enough foreign currency to cover one month of imports.
In July 2023, the IMF had previously approved a $3 billion bailout for the country, along with additional support from allies like Saudi Arabia and the UAE.
Sharif described the recent bailout as a crucial step toward stabilizing the economy, which he believes will help Pakistan face both immediate and medium-term challenges.
According to the BBC, this ongoing reliance on loans highlights the difficulties the country has faced due to past financial mismanagement and economic instability.
https://www.bbc.com/news/articles/c62rv7le52lo