Last September, the IMF saved Pakistan from possible default by agreeing to lend it $6.7 billion over three years. In return, Pakistan must make good on economic reforms such as a longstanding promise to privatise loss-making state companies. The IMF has also called on Islamabad to crack down on rampant tax evasion and broaden the tax base by eliminating tax exemptions and loopholes. The country's finances got a further boost after Saudi Arabia loaned Pakistan $1.5 billion to help shore up foreign exchange reserves, meet debt-service obligations and undertake large projects, Pakistani officials said this month.
According to an Islamabad-datelined press release, IMF Executive Board completes Second Review under the Extended Arrangement for Pakistan and Approves US $555.6 million disbursement. The Executive Board of the International Monetary Fund (IMF) on Monday completed the second review of Pakistan's economic performance under a three-year programme supported by an arrangement under the Extended Fund Facility (EFF). The completion of the review enables an immediate disbursement of an amount equivalent to SDR 360 million (about US $555.6 million).
The 36-month extended arrangement under the EFF in the amount of SDR 4.393 billion (About US $6.78 billion, or 425 percent of Pakistan's quota at the IMF) was approved by the Executive Board on September 4, 2013. In completing the second review, the Executive Board also approved the authorities' request for waivers of non-observance of the end-December 2013 performance criteria on net swap/forward position and government borrowing from the State bank of Pakistan (SBP) based on corrective actions taken by the authorities.