IMF and Pakistan reach staff-level deal on $1.21bn disbursement
Pakistan and the International Monetary Fund have reached a staff-level agreement that would give the country access to about $1.21bn once the Fund's Executive Board approves it. According to the IMF, the agreement covers the fourth review of Pakistan's 37-month Extended Arrangement under the Extended Fund Facility and the third review of the 28-month arrangement under the Resilience and Sustainability Facility. Approval would release about US$1.0bn (SDR 760 million) under the EFF and about US$210 million (SDR 154 million) under the RSF, bringing total disbursements under the two arrangements to about US$5.7bn.
The understanding follows discussions held under the 2026 Article IV consultation and the fourth review in Karachi and Islamabad from 23 September to 7 October, led by the IMF team headed by Iva Petrova. The staff-level agreement remains subject to approval by the IMF Executive Board, the Fund said.
On the macroeconomic picture, the IMF said the authorities have navigated the impact of the Middle East conflict and that strong policies have helped preserve stability. Real GDP growth reached 4 percent in the first three quarters of FY26, though higher energy prices and supply disruptions weakened momentum somewhat, leaving FY26 growth estimated at 3.6 percent. Headline inflation, after peaking in May, moderated to about 10.3 percent in September, while core inflation remained contained. The current account was broadly balanced in FY26 on the back of strong remittances, and gross reserves rose to about US$21½ billion by end-September. The IMF also pointed to sovereign rating upgrades and renewed international market access as signs of stronger policy credibility.
Risks nevertheless remain high, the Fund said, citing geopolitical tensions, volatile energy prices, tighter global financial conditions and trade disruptions. It said the authorities remain committed to sound macroeconomic policies, which it described as critical to safeguarding stability in a shock-prone environment. Their stated policy priorities include maintaining strong fiscal policies, enhancing public financial management, prioritising social spending and advancing energy sector viability.
