ISLAMABAD: The International Monetary Fund and Pakistan reached a “staff level agreement” on Sunday for a $6 billion bailout package, the Fund said in a statement, following months of negotiations on a deal that aims to bolster Pakistan’s flagging economy and perilously low foreign exchange reserves.
The agreement marks a step forward for Pakistan’s new Prime Minister Imran Khan as he tries to find ways to fix the country’s finances and show his commitment to restructuring its moribund economy. But it also highlights a sense of urgency for Pakistan where the central bank has only about $8 billion left in reserves, enough to cover less than eight weeks of imports.
“The Pakistani authorities and the IMF team have reached a staff level agreement on economic policies that could be supported by a 39-month Extended Fund Arrangement (EFF) for about $6 billion,” the IMF said in a statement.
“This agreement is subject to IMF management approval and to approval by the Executive Board, subject to the timely implementation of prior actions and confirmation of international partners’ financial commitments.”
Pakistan has already once averted a balance of payments crisis in 2013 after securing a $5.3 billion IMF loan package, as well as an $11 billion package in 2008, which was suspended after economic and reform targets were missed.
Talks with the IMF began soon after Khan’s government was appointed last August but a package has been held up by differences over the pace and scale of reforms that Pakistan would be required to undertake.
The IMF has pressed Pakistan to improve tax revenue collection, bolster foreign currency reserves and narrow a current account deficit expected to top 5 percent of gross domestic product this year. The Fund has also pushed Pakistan to embrace a flexible rupee policy. Pakistani officials fear these steps will further hurt economic growth, cause of spike in the key interest rate and push the Pakistani rupee further down.
The IMF said on Sunday the new bailout package would support the Pakistani government’s ambitious macroeconomic and structural reform agenda during the next three years, including a push to improve public finances and reduce public debt through tax policy and administrative reforms.
“At the same time, a comprehensive plan for cost-recovery in the energy sectors and state-owned enterprises will help eliminate or reduce the quasi-fiscal deficit that drains scarce government resources,” the statement said.
These efforts, the Fund said, would create fiscal space for a substantial increase in social spending to strengthen social protection as well as in infrastructure and human capital development.
Outlining critical steps Pakistan needed to take in its fiscal strategy, the IMF said the upcoming budget, to be announced this month, would aim for a primary deficit of 0.6 percent of GDP supported by tax policy revenue mobilization measures to eliminate exemptions, curtail special treatments, and improve tax administration.
“This will be accompanied by prudent spending growth aimed at preserving essential development spending, scaling up the Benazir Income Support Program and improve targeted subsidies, with the goal of protecting the most vulnerable segments of society,” the IMF said. “The State Bank of Pakistan will focus on reducing inflation, which disproportionately affects the poor, and safeguarding financial stability.”
“A market-determined exchange rate will help the functioning of the financial sector and contribute to a better resource allocation in the economy,” the IMF said.
The IMF has an unhappy history with Pakistanis, many of whom see the package negatively. In the past, the government has failed to meet the terms of a previous package in 2008, and the country is still struggling to repay billions of dollars of debt from that and a subsequent package.
Khan’s government is also ideologically hostile to international financial assistance, and he campaigned before the election on a platform of economic autonomy but has since gone to the IMF as well as Saudi Arabia, UAE and China for bailouts.
Inflation at its highest in more than five years has shocked many Pakistanis who voted for Khan and his promise to eradicate poverty, create jobs and build an Islamic welfare state.
The central bank forecasts growth at 3.5 to 4 percent in the 12 months to end-June, well short of a government target of 6.2 percent. The IMF paints a gloomier picture, predicting Pakistani growth of 2.9 percent in 2019 and 2.8 percent the following year.
IMF says has agreed to $6 billion deal with Pakistan to support growth
IMF says has agreed to $6 billion deal with Pakistan to support growth
- Package will support government’s ambitious macroeconomic, structural reform agenda for three years
- IMF says upcoming Pakistan budget will aim for primary deficit of 0.6 percent of GDP
Pakistan, Uzbekistan launch direct air link to deepen regional connectivity
- Uzbekistan Airways flight departed Islamabad for Tashkent with 126 passengers Saturday afternoon
- Pakistan is also advancing plans for a railway link connecting Peshawar with Kabul and Tashkent
KARACHI: Pakistan on Saturday hosted the inaugural direct flight by Uzbekistan Airways between Islamabad and Tashkent, marking yet another step toward enhanced regional connectivity and deeper economic ties with Central Asia.
Pakistan has been pushing to forge stronger trade links with landlocked Central Asian nations by offering access to its Arabian Sea ports. While several regional states border Afghanistan, Uzbekistan is seen as a strategic gateway due to its central location in the region and its larger economy.
“The Pakistan Airports Authority (PAA) proudly hosted the inaugural flight ceremony of Uzbekistan Airlines’ direct service from Islamabad to Tashkent (Flight HY466), marking a significant milestone in enhancing regional air connectivity and people-to-people ties between Pakistan and Central Asia,” said a PAA statement.
The flight, carrying 126 passengers, departed Islamabad at 1:09 p.m. on Saturday, following a festive check-in at Zone 1 of the international airport adorned with balloons, the statement said.
It informed that ambassadors from Uzbekistan, Tajikistan, Kazakhstan and Azerbaijan attended the ceremony, joined by airport officials, tourism executives and Uzbekistan Airlines’ country manager.
Pakistan is also advancing plans for a railway link connecting Uzbekistan to Pakistan through Afghanistan. Earlier this month, Foreign Minister Ishaq Dar spoke with Afghan counterpart Amir Khan Muttaqi and Uzbek officials about the proposed 573‑km Uzbekistan‑Afghanistan‑Pakistan (UAP) Railway Project.
The corridor aims to link Tashkent with Kabul and Peshawar, enhancing freight movement and reducing transit time by up to several days.
The overland route via Afghanistan connects Pakistan’s road and rail network through the mountainous frontier into Afghanistan and onward to Central Asia, offering an alternative to existing northbound trade routes.
Pakistan arrests suspects in visa fraud targeting job seekers hoping to reach Gulf, Europe
- All three suspects, including a woman, took large sums from people before going into hiding
- FIA arrested them from different cities after they failed to deliver on promised overseas jobs
ISLAMABAD: Pakistan’s Federal Investigation Agency (FIA) on Saturday arrested three individuals, including a woman, for allegedly defrauding job seekers by promising employment in Gulf countries and Europe, state media reported.
The arrests were made during raids in Bahawalpur, Bahawalnagar, Multan, and Lodhran. The suspects, identified as Abid Hussain, Hira Noor and Ajmal, are accused of collecting large sums from citizens in exchange for fake overseas job arrangements.
“These suspects were arrested for their involvement in visa fraud and human smuggling,” the Associated Press of Pakistan (APP) news agency said, adding all three went into hiding after failing to deliver on their promises.
The report further said Abid Hussain received Rs800,000 ($2,800) from one victim for a job in Saudi Arabia. Hira Noor allegedly took over Rs2.9 million ($10,150) from another individual, promising work in Europe. Ajmal is accused of charging Rs400,000 ($1,400) to arrange employment in Dubai.
The arrests come amid renewed efforts by Pakistan to crack down on human smuggling networks after a series of deadly boat tragedies in recent years involving Pakistani nationals trying to reach Europe as undocumented migrants.
Despite enforcement drives, criminal syndicates continue to exploit economically vulnerable individuals seeking better opportunities abroad.
Pakistan PM urges ‘credible’ global action to halt Israel’s war in call with Iran’s president
- President Masoud Pezeshkian calls for greater Muslim unity in the face of escalating regional threats
- Pakistan’s defense minister also urges Muslim countries to sever their diplomatic relations with Israel
ISLAMABAD: Prime Minister Shehbaz Sharif on Saturday urged the international community and the United Nations to take “urgent and credible steps” to end Israel’s war in Iran, during a phone call with a phone call with Iranian President Masoud Pezeshkian, according to a statement from his office.
Israel launched surprise attacks on Iranian nuclear and military facilities in the early hours of Friday amid Tehran’s negotiations with Washington over its nuclear program. The strikes killed several senior military commanders and nuclear scientists, according to Iranian media, and also caused civilian casualties.
Israel, at war in the region since October 2023, initially launched a military campaign against Gaza following a Hamas assault, which the Palestinian group said was retaliation for decades of oppression. Since then, the Israeli government has expanded its military operations to neighboring Muslim states such as Syria and Lebanon before targeting Iran.
Sharif said Pakistan stood in “resolute solidarity” with Iranian people and government during his conversation with the Iranian president.
“The Prime Minster denounced Israel’s blatant provocations and adventurism as a grave threat to regional and global peace and stability,” said the statement released by his office after the phone call.
“He urged the international community and the United Nations to take urgent and credible steps to put an end to Israel’s aggressive behavior and its illegal actions,” it added. “He stated that Pakistan was fully committed to promoting peace in the region and stood ready to play its role in this context.”
Sharif also conveyed condolences over the loss of life in Friday’s Israeli strike and recalled Pakistan’s statement of support for Iran during an emergency session of the UN Security Council a day earlier.
The Iranian President thanked Pakistan for its solidarity and support and called for greater unity among Islamic countries in the face of escalating regional threats.
UNIFIED STRATEGY
Earlier in the day, Pakistan’s Defense Minister Khawaja Asif urged Muslim nations to adopt a unified strategy to counter Israel, warning that failure to act collectively would leave them vulnerable, as he expressed full diplomatic support to Iran in a speech to the National Assembly following Israeli strikes.
“Just as Israel is currently targeting Yemen, Iran, and Palestine, if the Muslim world does not unite today and continues to prioritize its own interests and agendas, then everyone’s turn will come,” he told lawmakers.
“An OIC meeting should be convened, and all Muslim countries must come together to devise a strategy through which Israel can be confronted collectively,” he continued. “There is a need for an initiative that reflects the unity of the Islamic world. Wherever there are diplomatic ties with Israel in the Muslim world, they should be severed.”
The Pakistani minister added the Muslim world remained “militarily vulnerable” and voiced what he described as Pakistan’s unwavering solidarity with Iran.
NO NUCLEAR TALKS
The Iranian foreign ministry also announced during the day it would no longer take part in planned nuclear negotiations with the United States in Oman, calling them “meaningless” while Israeli attacks continued.
“It is obvious that in such circumstances and until the Zionist regime’s aggression against the Iranian nation stops, it would be meaningless to participate in dialogue with a party that is the biggest supporter and accomplice of the aggressor,” an Iranian spokesperson said, according to international wire agencies.
Israel’s defense minister also warned “Tehran will burn” if Iran continued to launch missiles at Israeli cities. Iran had retaliated on Friday night by launching a barrage of missiles at Israel, with explosions lighting up the skies over Jerusalem and Tel Aviv.
Just a day earlier, hours after Israel targeted Iran, Pakistan’s envoy to the UN, Ambassador Asim Iftikhar Ahmad, condemned the strike on Iran’s military and nuclear infrastructure, calling it a violation of international law.
“Iran has the right to self-defense under Article 51 of the UN Charter,” he said, urging all sides to avoid further escalation and emphasizing the need to resolve tensions through diplomacy.
Pakistan PM calls for quick EV policy with stakeholder input to promote clean transport
- Shehbaz Sharif seeks ‘priority measures’ to promote electric motorcycles, scooters, cars and buses
- He says charging stations and battery-swapping centers must be ensured to strengthen EV rollout
ISLAMABAD: Pakistan’s government on Saturday pledged to promote electric vehicles (EVs) across all segments of transport, with Prime Minister Shahbaz Sharif calling for a national policy on the subject to be finalized in consultation with stakeholders.
The move comes amid a steady rise in EV adoption in a market long dominated by Japanese automakers such as Suzuki, Toyota and Honda. Increasingly, Chinese and Korean brands are entering the space, with electric vehicles becoming more and more visible in cities like Islamabad, Lahore and Karachi.
The government is hoping to ride this momentum to cut fuel imports and reduce emissions.
“Priority measures will be taken for the promotion of electric motorcycles, scooters, three-wheelers, cars and buses,” the prime minister said while chairing a meeting in Lahore to discuss the adoption of EVs.
The draft Electric Vehicles Policy 2025 was reviewed at the meeting, with Sharif calling for its urgent finalization “in consultation with all stakeholders” before being presented to the cabinet.
“Charging stations and battery-swapping stations must be ensured,” he said during the meeting. “Industries will also be facilitated to increase the manufacturing capacity of two- and three-wheelers.”
While EVs offer a way to reduce the country’s petroleum import bill and carbon footprint, the lack of infrastructure, frequent power outages and limited financing options remain key impediments to their widespread adoption and scale-up.
Yet industry experts believe existing players in Pakistan’s auto market will face stiff competition from various EV brands, with many seeing electric vehicles as poised to consolidate their place in the domestic market.
Pakistan delegation in Brussels says Islamabad can develop counterterror partnership with Delhi
- India blames Pakistan for supporting “terrorist” attacks in the part of disputed Kashmir it governs
- Islamabad, Washington thwarted attacks in Pakistan, US and Europe, says head of delegation
ISLAMABAD: The head of a delegation visiting Brussels to present Pakistan’s point of view regarding the country’s recent military standoff with India said on Saturday that Islamabad can develop a “phenomenal” counterterror partnership with Delhi, similar to the one it has with Washington.
India blames Pakistan for arming and funding militants who carry out subversive activities in the part of disputed Kashmir it governs, an allegation Islamabad has always denied. The two countries engaged in a military confrontation for four days last month after India accused Pakistan of supporting an attack at the Pahalgam tourist resort in Indian-administered Kashmir. Twenty-six people, mostly tourists, were killed in the attack.
Pakistan enjoys counterterror cooperation with several countries, including the US, which includes intelligence sharing and other forms of coordination to thwart militant attacks. The head of the United States Central Command (CENTCOM), General Michael Kurilla, this week praised Pakistan as a “phenomenal partner” in counterterrorism efforts during a testimony.
Speaking to reporters in Brussels, Bilawal Bhutto Zardari, who is the head of the Pakistani delegation, pointed out that the US and Pakistan have thwarted “terrorist attacks” in Europe, the US and Pakistan through counter-terror coordination.
“Will we be more effectively able to combat terror if India and Pakistan sat together and coordinated, conducted intelligence sharing,” Bhutto Zardari asked in response to a question.
Citing Kurilla’s statement, Bhutto Zardari said Islamabad can develop a counter-terror partnership with New Delhi similar to the one it enjoyed with Washington.
“We can develop that phenomenal partnership with India as well,” he added.
He lamented that there was no cooperation or coordination between the two nuclear-armed nations on combating “terrorism,” adding that the two countries last had a dialogue on counter-terror in 2012.
Prime Minister Shehbaz Sharif announced the nine-member diplomatic group last month, headed by Bhutto Zardari, who is a former foreign minister and the head of the Pakistan Peoples Party.
He has been leading a team to visits in New York, Washington DC, London and Brussels since June 2. Another delegation, led by Special Assistant to the Prime Minister Syed Tariq Fatemi, has visited Moscow.
While the ceasefire between the two countries continues to remain in place, tensions continue to simmer as India says it is holding in abeyance a decades-old water-sharing treaty with Pakistan.
Islamabad had said after India suspended the Indus Waters Treaty that it considered any attempt to stop or divert the flow of water belonging to Pakistan to be an “act of war.”
About 80 percent of Pakistani farms depend on the Indus system, as do nearly all hydropower projects serving the country of some 250 million.
Pakistan and India, bitter rivals, have fought two out of three wars over the disputed territory of Kashmir that they both claim in full but govern only parts of.
