Pakistan to receive $1.4bn from IMF next week, to combat COVID-19

• Pakistan has requested 1.4 billion dollars under the RFI.
• It may be mentioned here that the $1.4bn loan to Pakistan from IMF is in addition to the country’s $6bn bailout package, the country signed with the IMF last year.

Pakistan will receive $1.4 billion from the International Monetary Fund (IMF) next week, under the Rapid Financing Instrument (RFI) to deal with the economic turmoil in the wake of coronavirus.

On 29 March 2020, the Managing Director of the IMF announced that the government of Pakistan has requested 1.4 billion dollars under the RFI and stated that a Fund's team was working expeditiously to respond to this request so that a proposal can be considered by the IMF's Executive Board as soon as possible.

“We have been working with the Pakistani authorities since the request was placed … This $1.4 billion disbursement is scheduled to happen next week,” informed Teresa Daban Sanchez, the IMF Resident Representative in Pakistan, quoted Arab News.

It should be mentioned here that the $1.4bn loan to Pakistan from IMF is in addition to the country’s $6bn bailout package, the country signed with the IMF last year.

“This $1.4 billion we are requesting will be a low cost, fast disbursing loan," said Finance Adviser Abdul Hafeez Shaikh. He said Pakistan would like the IMF to consider the loan separately to funds it had already set aside for losses to economies across the world due to the pandemic.

“We would like to secure funds for us before those losses are evaluated," he said.

Last month, the State Bank of Pakistan cut its benchmark interest rate, lowering it by 150 basis points to 11pc, and announced a package of measures to support the economy and poorer workers hit by the pandemic. The country has reported over 4000 people infected by the virus, which has so far killed 58.