• Pakistan reaches a staff-level agreement with IMF for a $1.2 billion loan.
• The deal includes $1 billion under the Extended Fund Facility and $200 million under the Resilience and Sustainability Facility.
• The agreement aims to stabilize Pakistan's economy and signals renewed investor confidence.

The International Monetary Fund (IMF) announced on October 14 that it has reached a staff-level agreement with Pakistan for a loan program, potentially granting access to $1.2 billion pending Executive Board approval. This agreement includes $1 billion under its Extended Fund Facility (EFF) and $200 million under the Resilience and Sustainability Facility (RSF), raising total disbursements under these programs to approximately $3.3 billion, according to Reuters and AA.

This agreement comes after a two-week visit by an IMF team, which assessed Pakistan's economy, highlighting improvements such as the first current account surplus in 14 years, along with improved fiscal performance. However, the IMF cautioned that recent floods affecting nearly 7 million people have impeded growth, significantly impacting the agricultural sector, according to India Times and AA.

Pakistan's Finance Minister, Muhammad Aurangzeb, referred to the deal as a "major step forward" for the country's financial strategy and emphasized the government's commitment to fiscal discipline and structural reforms, which have been focal points for IMF support. This commitment is crucial to sustaining market confidence, as noted by Reuters and India Times.