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The International Monetary Fund agreed Wednesday to rescue Pakistan's shattered economy from default, granting a $5.5 billion bailout package, finance officials said.

Pakistan's economy has been reeling from international sanctions that followed nuclear tests this year, and the nation owed $32 billion to international creditors.

The biggest hurdle to the bailout package was removed earlier this month when the United States agreed to support a one-time deal for Pakistan despite sanctions imposed on both Pakistan and neighboring India last May.

The deal announced Wednesday requires final approval by the IMF board of directors at a meeting in Washington next month, Pakistan's finance ministry officials said at a news conference in Islamabad, the federal capital.

The United States imposed economic sanctions on Pakistan and its rival India after the two neighbors conducted underground nuclear tests in May. The embargo hit Pakistan hard because it relied heavily on foreign loans and had meager reserves of hard currency needed to pay for imports.

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