Overview

• Upon IMF Executive Board approval, Pakistan would receive about $1.0 billion under the Extended Fund Facility and $200 million via the climate-focused Resilience and Sustainability Facility, lifting total disbursements to roughly $3.3 billion.
• The IMF said recovery remains on track, citing a FY25 current account surplus for the first time in 14 years, contained inflation, stronger external buffers, and improved financial conditions as sovereign spreads narrowed.
• Recent floods affecting nearly 7 million people and causing over 1,000 deaths have weakened the outlook, with FY26 GDP projected around 3.25%–3.5% due to agricultural damage.
• Authorities committed to fiscal consolidation, strengthening social protection through BISP, a data-dependent monetary stance to hold inflation within the 5%–7% target, and energy sector measures to curb circular debt and improve distribution.
• In Washington, the finance minister advanced steps to accelerate IFC financing for the Reko Diq project, welcomed an IFC regional office in Islamabad, noted IsDB financing for M-6 sections, invited US investment, and outlined plans for a yuan-denominated green Panda bond this year and a return to international bond markets next year.