Pakistan has secured the IMF’s initial approval for a USD 3 bln loan program, reducing the risk of a sovereign default. Awaiting final approval by the IMF Executive Board, this preliminary agreement is expected to be reviewed by mid-July. Overcoming current economic hurdles will demand robust policy implementation, including stricter fiscal discipline, market-determined exchange rates, and continued progress on reforms, especially in the energy sector. The country’s USD reserves have plunged nearly 60% to USD 3.5 bln as of mid-June, restricting import funding and leading to numerous factory shutdowns. The nine-month stand-by arrangement builds upon Pakistan’s IMF-supported 2019 program, set to expire at June’s end.