Pakistan reaches a staff-level agreement with IMF for $1.2-bn loan

Pakistan has reached a staff-level agreement with the International Monetary Fund to resume its loan program, according to a government official familiar with the matter. 

A $1.2 billion disbursement is expected in August after the IMF’s management gives final approval, the person said, asking not to be identified before a formal announcement. Representatives for the IMF in Pakistan and the nation’s finance ministry didn’t reply to emails seeking comment.

The disbursal would offer relief to the South Asian nation, whose foreign-exchange reserves can cover less than two months of imports. Inflation has accelerated to a 13-year-high. Pakistan has raised electricity tariffs and almost doubled diesel pump prices over the past two months to meet IMF conditions. 

The Washington-based lender has also agreed to increase the loan program size by $1 billion  -- taking it to a total $7 billion -- and extend it through June 2023, the person said.