KARACHI, Nov 13: Pakistan has received $245 million from the IMF as the seventh and eighth tranches of the $1.5 billion Poverty Reduction and Growth Facility. The IMF had approved disbursement of the two tranches in one go, on October 27, in the light of the commendable performance Islamabad showed in implementing the IMF reform package under this facility.

“The State Bank has received $245 million from the IMF,” SBP chief spokesman Syed Wasimuddin told Dawn. He said that with the inflow of this money, Pakistan’s liquid foreign exchange reserves had risen to $11.75 billion. Of this $10.28 billion are owned by the central bank and the remaining $1.47 billion by the banks.

The IMF had approved Pakistan’s PRGF on December 7, 2001. The three-year facility that carries an annual interest rate of 0.5 per cent is due to expire in December 2004. Pakistan has told the IMF officially that it does not intend to make further borrowing from the Fund when the current expires. But it intends “to stay closely involved with the IMF after this arrangement expires, and to engage actively with the Fund in dialogue on how economic growth can be strengthened in the medium-term,” according to an IMF press release.

Pakistan has received $245 million as two tranches of the PRGF after meeting many tough conditions set by the IMF in almost all areas of macroeconomic management. The country is now required to meet many more conditions to qualify for the ninth and tenth tranches in the next year.

These include establishment of a transparent regulatory framework for setting of electricity tariff and privatization of Habib Bank Ltd, by the end of this year and adjustment of rates of return on national saving schemes in line with the yields on Pakistan Investment Bonds.