The International Monetary Fund (IMF) has approved a 6.7 billion dollar loan to Pakistan for the latter to resolve its economic crisis. Pakistan has been asked to introduce reforms to increase growth, bring down the budget deficit and improve the rate of tax collection to receive the funds, the BBC reports.
The loan amount will be paid out over a period of three years, beginning with the release of 540 million dollars. As per the new plan, the deficit must fall from around nine percent of GDP last year to as low as 3.5 to 4% in three years, while tax collection must also improve.
The government hopes that reforms to the energy sector will help prevent frequent power cuts, the report added. Pakistan already owes nearly five billion dollars to the IMF out of earlier loans, the report added.