Pakistan gets $7.6 bn IMF rescue fund
Islamabad, Nov 25: International Monetary Fund aka IMF in its first intervention since the beginning of the ongoing global financial turmoil has approved a $7.6 billion rescue fund for Pakistan, which in turn will help the country in its economic stabilisation programme.
An amout equivalent to $3.1 billion will be made available immediately to Pakistan and the remaining will be phased in as per the approval of IMF's Executive Board. This will be subjected to quarterly reviews in a 23-month stand-by arrangement. Board approved the arrangement under IMF's fast-track Emergency Financing Mechanism procedures. IMF said in a statement that through this assistance it aims to achieve the key objectives of restoring macro-economic stability, to ensure social stability, adequate support for the poor in Pakistan.
The IMF intervention in Pak economy was the result of worsening macro-economic situation singnificantly since mid-2007. It cited that the adverse security developments, large exogenous price shocks, increase in oil and food import prices, ongoing global financial crisis, instability in the economy during the transition to the new government led to slower growth rate and higher inflation in Pakistan.
The
programme
initiated
by
the
government
with
support
from
the
IMF
envisages
a
significant
tightening
of
fiscal
policy.
Pakistan
has
a
quota
of
Special
Drawing
Rights
of
about
$1,526.6
million.
It
became
a
member
in
IMF
in
1950.