KARACHI: The finance adviser to the Pakistani prime minister said on Saturday a $6 billion bailout loan secured from the International Monetary Fund this month carried an interest rate of 3.2 percent.
Under the IMF’s terms, the government is expected to let the rupee fall to help correct an unsustainable current account deficit and cut its debt while trying to expand the tax base in a country where only one percent of people file returns.
“The program we have obtained has a magnitude of $6 billion and is spread over three years,” finance adviser Abdul Hafeez Shaik said at a press conference. “The good thing about it is that the rate of borrowing is much lower than other programs. The interest rate is 3.2 percent.”
The country’s last IMF bailout, signed in 2014, carried a 2 percent interest rate and was repayable after 30 years.
Pakistan’s foreign currency reserves currently stand at around $8 billion, not enough to cover three months of imports, making the country desperate for the IMF board to give its blessing for the release of the first tranche of the loan.
Signing the IMF program would “send a good signal to the international community that Pakistan wishes to take its economy forward in a disciplined manner and people will find incentive to form alliances and partnerships with us,” Shaikh said, adding that the country would also now be able to get $2-3 billion in loans from the World Bank and the Asian Development Bank.
Shaikh has to present a 2019/20 budget next month, having been told by the IMF that the primary budget deficit — excluding interest payments — should be cut to 0.6 percent of GDP, implying a $5 billion reduction from the current projection for a deficit of 2.2 percent.
“In the coming days important decisions would be taken for the improvement of the country’s economy,” he said. “The difficult time is about to end and the coming year would be a year of stability.”
Inflation at its highest in more than five years has shocked many Pakistanis who voted for Prime Minister Imran Khan and his promise to eradicate poverty, create jobs and build an Islamic welfare state. This month, the central bank has hiked its key interest rate by 150 basis points to 12.25 percent even though the economy is slowing and millions of people are struggling to find work.
“The government will take steps to protect vulnerable segments,” the finance adviser said.
Finance adviser says Pakistan’s $6 bln IMF loan carries 3.2% interest rate
Finance adviser says Pakistan’s $6 bln IMF loan carries 3.2% interest rate
- Last IMF bailout signed in 2014 carried a 2 percent interest rate, was repayable after 30 years
- Under IMF’s terms, government is expected to let rupee fall to correct current account deficit
Pakistan arrests suspect arriving from Cambodia amid crackdown on human smuggling
- Suspect worked at an “online fraud company” in Cambodia, later started smuggling people from Pakistan, says FIA
- Pakistan has intensified crackdown against human smugglers after hundreds of migrants drowned near Pylos in 2023
ISLAMABAD: Pakistan’s Federal Investigation Agency (FIA) on Sunday said it had arrested a key suspect involved in smuggling humans who had arrived from Cambodia, alleging he was also part of an international fraud network.
The suspect, identified as Zainullah, was arrested by FIA officials when he arrived in the southern port city of Karachi from Cambodia.
Zainullah had traveled from Pakistan to Cambodia in September 2024, a press release issued by the agency said.
“He worked at an online fraud company in Cambodia and later became involved as an agent in recruiting individuals from Pakistan,” the FIA said.
The FIA said it recovered images of multiple individuals’ passports, payment receipts and bank transaction records after extracting data from Zainullah’s phone.
It said the suspect received money through personal bank accounts and a cryptocurrency account.
“The suspect has been handed over to the FIA Anti-Human Trafficking Circle, Karachi, for further legal proceedings,” the FIA said.
“Further investigation is underway.”
Pakistan intensified action against illegal migration in 2023 after hundreds of migrants, including 262 Pakistanis, drowned when an overcrowded vessel sank off the Greek town of Pylos, one of the deadliest boat disasters in the Mediterranean.
Authorities say they continue to target networks sending citizens abroad through dangerous routes, following heightened scrutiny at airports and a series of arrests involving forged documents.
Pakistan’s interior ministry said this week illegal migration to Europe has declined by 47 percent this year after its nationwide crackdown, saying that more than 1,700 human smugglers have been arrested in 2025.
