The International Monetary Fund (IMF) has announced an "immediate disbursement" of a loan tranche worth around $1.1 billion to Pakistan to help stabilize crumbling economy of the South Asian country.
The decision came late Monday after the IMF Executive Board completed the second review under the Stand-By Arrangement (SBA) to complete a total loan of $ 3 billion agreed under a deal last year.
However, the global lender underlined the need for concentrated efforts for sustainable recovery.
"To move Pakistan from stabilization to a strong and sustainable recovery the authorities need to continue their policy and reform efforts, including strict adherence to fiscal targets while protecting the vulnerable; a market-determined exchange rate to absorb external shocks; and broadening of structural reforms to support stronger and more inclusive growth," the IMF said in a statement.
Pakistan's economy was pulled back from the brink amid fears of default when the IMF approved a short-term $3 billion bailout package. Signed in July last year, Pakistan has already received $1.9 billion under the program.
Prime Minister Shehbaz Sharif's team has laid the groundwork for yet another long-term bailout as the new government seeks to stabilize the economy.
Sharif's government says it inheritedthe economic crisis from the previous government of Imran Khan whose policies pushed the country to the brink.
The government is struggling to tackle soaring inflation, a heavy debt burden, unemployment and high electricity and gas prices.