The International Monetary Fund (IMF) has approved 500 million dollars disbursement to Pakistan for budget support.

The disbursement was done after the IMF Executive Board completed delayed reviews of Pakistan’s six billion-dollar loan programme.

“The programme aims to support Pakistan’s policies to help the economy and save lives and livelihoods amid the still unfolding COVID-19 pandemic,’’ the IMF said in a statement.

The approval has paved the way for the release of the third tranche of a 1.45-billion-dollar-bailout package which Pakistan had secured in 2019 to avert a balance of payment crisis.

The loan facility was suspended in April 2020 due to lack of progress on a package of economic reforms attached to the loan which included raising energy prices and boosting revenue collection, which is one of the lowest in the world.

The IMF had also asked Pakistan to give up central bank control of the currency and to adopt a market-based exchange rate, privatise loss-making public sector companies and end subsidies in power and agriculture sectors.

Some of the reforms have been implemented since the deal was signed. The government increased electricity prices by 16 per cent in February.

The economy of the Muslim nation with a population of 220 million has slid deeper into crisis since Prime Minister Imran Khan took over in 2018.

Pakistan’s economy had started gradually recovering from the aftermath of the COVID-19 pandemic, but the country currently faces a third wave.

On March 19,, the central bank projected three per cent GDP growth for this fiscal year.