The International Monetary Fund (IMF) has approved a $7bn (£5.25bn) loan to cash-strapped Pakistan.
The country will receive an initial $1 billion loan immediately, with the balance to be paid over the next three years.
Prime Minister Shehbaz Sharif welcomed the decision and thanked IMF Managing Director Kristalina Georgieva and her team.
Pakistan has received more than 20 loans from the IMF since 1958 and is currently its fifth-largest debtor.
The IMF said the new plan “will require sound policies and reforms” to stabilize the economy and help it become more resilient.
The South Asian country promised that this would be the last loan from the international lender.
As part of the deal, Islamabad agreed to some unpopular measures, including increasing taxes on individuals and businesses.
The country has relied on IMF loans for decades to meet its needs, but it continues to struggle due to years of financial mismanagement.
Last year, the country came close to defaulting on its debt and had foreign reserves sufficient to cover just one month’s worth of imports.
In July 2003, the International Monetary Fund approved a $3 billion bailout for Pakistan.. It also received funding from allies Saudi Arabia and the United Arab Emirates.
At the time, Sharif said the rescue package was an important step forward in efforts to stabilize the economy.
“It strengthens Pakistan’s economic position and will help Pakistan overcome its immediate and medium-term economic challenges,” he said.
