IMF Approves $1 Billion Disbursement to Pakistan Amidst Indian Protests

The International Monetary Fund (IMF) approved a $1 billion disbursement to Pakistan under its Extended Fund Facility, despite India’s objections and abstention from voting. The program aims to stabilize Pakistan's economy and includes measures like tax reform and energy sector improvements.

The International Monetary Fund (IMF) has announced an immediate disbursement of approximately $1 billion to Pakistan as part of the Extended Fund Facility, according to the Prime Minister's Office in Islamabad. Prime Minister Shehbaz Sharif expressed satisfaction with the IMF's decision, despite India's high-handed tactics against the funding.

India voiced concerns regarding the effectiveness of IMF programs in Pakistan, particularly highlighting the potential misuse of funds for state-sponsored terrorism. New Delhi opposed additional loans for Pakistan and chose to abstain from voting during the crucial IMF meeting. It argued that funding could be misused and triggered reputational risks for financial institutions.

As the economic situation in Pakistan improves, the IMF's program is seen as pivotal for stability and development. Priority areas include tax reform, energy sector performance, and private sector development. The approval opens the door for future disbursements, totaling $6 billion over a three-year period, contingent upon successful program reviews.

(With inputs from agencies.)