Pakistan pushes for early IMF tranche approval as review talks loom

Pakistan is seeking early approval of the next tranche of funds from the International Monetary Fund as it prepares for a key review of its economic programme next month, Finance Minister Muhammad Aurangzeb said.

Speaking in Washington on the sidelines of the World Bank-IMF Spring Meetings, Aurangzeb said Islamabad’s immediate priority was securing the release of about $1.2 billion. This includes roughly $1 billion under the ongoing 37-month Extended Fund Facility (EFF) agreed in 2024, and another $200 million under the Resilience and Sustainability Facility (RSF).

“Our focus is on getting an early approval for the next tranche,” he said, adding that an IMF team is expected to visit Pakistan next month for consultations as part of the programme review.

Programme review and reform track

A staff-level agreement was reached last year following the second review of Pakistan’s economy under the IMF programme. The upcoming visit will assess progress on reforms and macroeconomic targets before the next disbursement is cleared.

Aurangzeb said discussions with IMF officials have also covered the potential impact of global developments, particularly the Iran conflict, on Pakistan’s economy.

The minister described the reopening of the Strait of Hormuz as a “very good development”, noting that it would ease pressure on global oil supplies and help stabilise energy prices.

Had the conflict continued, it could have affected “everything from economic growth to inflation”, he said.

“We hope the situation will improve, but hope is not a strategy, and that’s why we had planned for everything,” Aurangzeb added.

External sector indicators

Highlighting recent economic indicators, Aurangzeb said Pakistan recorded a current account surplus of over $1 billion in March.

He also pointed to:

• Remittance inflows of $3.8 billion during the month

• Record inflows of $261 million under the Roshan Digital Account

He said the Pakistani diaspora continues to play a key role in supporting the country’s external sector through formal financial channels.

Aurangzeb said his meetings in Washington with counterparts from China, the United States and the United Kingdom focused on expanding cooperation in trade, investment and sectors such as information technology, minerals and energy.

He also highlighted efforts to strengthen the financial system, including improving regulatory oversight and formalising exchange company operations through coordination between the finance ministry, the State Bank of Pakistan and law enforcement agencies.

Policy stance

Reiterating the government’s approach, Aurangzeb said responsible borrowing remains central to Pakistan’s economic strategy.

He added that international financial platforms should be used for knowledge-sharing and peer learning rather than advocacy for debt relief.

Pakistan has been working under IMF-supported programmes to stabilise its economy amid fiscal pressures, external debt obligations and balance of payments challenges.

The approval of the next tranche is seen as crucial for maintaining investor confidence and ensuring continued external financing support.