SBP receives $1bn second tranche from IMF

• SBP receives $1.023bn under IMF’s EFF programme.
• IMF funds to show in May 16 reserves, says SBP.
• Disbursement follows Executive Board’s May 9 nod.

The State Bank of Pakistan (SBP) has announced it has received the second tranche of funding from the International Monetary Fund (IMF) under the Extended Fund Facility (EFF) programme.

According to an official statement issued by the central bank on Wednesday, Pakistan has received Special Drawing Rights (SDR) 760 million, equivalent to $1.023 billion, as part of the second instalment under the EFF agreement.

The SBP said the received amount will be reflected in the country’s foreign exchange reserves for the week ending May 16.

The disbursement follows the IMF Executive Board’s approval on May 9, which also cleared a new $1.4 billion arrangement under the Resilience and Sustainability Facility (RSF) to support Pakistan’s climate resilience initiatives. 

With this, total disbursements under the EFF have reached approximately $2.1 billion (SDR 1.52 billion).

The approval came amid geopolitical tension, with India urging the IMF to reconsider Pakistan’s case following a deadly attack in Pahalgam, Indian Illegally Occupied Jammu and Kashmir (IIOJK). 

Nonetheless, the Fund endorsed Pakistan’s economic programme, with Prime Minister Shehbaz Sharif welcoming the outcome and criticising India's attempts as “underhanded tactics.”

In a statement, the PMO said the IMF’s decision was a rejection of false propaganda and a validation of Pakistan’s development trajectory.

Speaking to Geo.tv, Dr Khaqan Hassan Najeeb, former adviser at the Ministry of Finance, highlighted the significance of the disbursement: “Securing the first review of the EFF with the IMF was crucial for Pakistan, as ongoing engagement with the Fund underpins macroeconomic stability and ensures the rollover of external loans and fulfillment of new commitments." 

"A key component of macro stability has been the slowing of inflation in the country, which has allowed for a substantial reduction in the policy rate, an improvement in the current account, and a build-up in FX reserves," he added.

He further added: "It is important to recognise that IMF support has provided Pakistan with valuable breathing space to pursue deeper, structural reforms—essential for restoring the country’s economic fundamentals." 

"Budget FY26 is a key opportunity to do much-needed transformational work on the expenditure side of the equation and also for advancing vertical and horizontal equity in taxation," he continued.

"Ultimately, reorienting the economy towards sustainable productivity requires a vision that extends well beyond the scope of any three-year EFF arrangement,” he concluded.

Finance Minister Muhammad Aurangzeb met IMF Managing Director Kristalina Georgieva in Washington during the 2025 Spring Meetings, where he reaffirmed Pakistan’s reform commitment and requested an expansion of China’s currency swap line from 30 billion to 40 billion yuan ($1.4 billion).

Pakistan and the IMF had reached a staff-level agreement in March under the $7 billion EFF, aimed at ensuring economic stability and facilitating structural change.