Key points:
- IMF agrees to $7 billion loan deal with Pakistan to stabilize its economy.
- Pakistan commits to reforms, including expanding its low tax base
The International Monetary Fund (IMF) has agreed to a $7 billion loan deal with Pakistan, aimed at stabilizing its struggling economy. In return, Pakistan has committed to implementing further reforms, including expanding its low tax base. Last year, Pakistan faced potential default amid political turmoil, severe monsoon floods, and prolonged economic mismanagement. While last-minute loans and previous IMF support averted immediate collapse, the country’s finances remain precarious, with high inflation and substantial public debt. This three-year agreement, pending IMF Executive Board approval, is expected to enhance macroeconomic stability and promote inclusive growth.