Minister of State for Finance and Revenue Dr Aisha Ghaus Pasha said on Thursday that the International Monetary Fund (IMF) has received a commitment from Saudi Arabia regarding funding for Pakistan.

Last month, Finance Minister Ishaq Dar had said that financing commitments from friendly countries were the last hurdle in securing the IMF deal, which Pakistan needs to stave off default.

In a parliamentary address last week, Prime Minister Shehbaz Sharif had also said that the IMF wants external financing commitments fulfilled from friendly countries before it releases bailout funds.

The international lender has been negotiating with Islamabad since early February to resume $1.1 billion in funding held since November, which is part of a $7 billion bailout agreed in 2019.

With central bank reserves falling to critical levels, hardly enough for four weeks of imports, the IMF tranche is critical for the country as it will also unlock other external financing avenues, helping Pakistan avert a default on its obligations.

“IMF has indicated to us that they received correspondence from Saudi Arabia on the funding commitment,” Pasha said.

“Our situation has improved and talks with UAE are also underway,” Pasha said, adding that Pakistan would need a similar commitment from the Emirates as well before things with the IMF progress.