In a significant setback to Pakistan’s economic recovery efforts, the International Monetary Fund (IMF) has declined to approve a $7 billion tranche, despite a staff-level agreement reached in June and July 2024. The decision comes amid escalating concerns over the country’s political stability, which has been flagged by the diplomatic community in Islamabad.

Reports from diplomats stationed in the capital have been sent to their respective governments, warning of “looming chaos” as the Pakistani government struggles to maintain order.

Read more: The IMF Projects Pakistan’s Economy to Expand by 3.5% for the Fiscal Year

The political landscape in Pakistan has been described as deteriorating, with the government facing severe criticism for failing on “all fronts.”

Prominent journalist Fakhar Ur Rehman, who broke the news, emphasized the gravity of the situation, stating that the IMF’s refusal to release the funds is directly linked to the growing instability in the country.

This development poses a significant challenge for Pakistan, which is already grappling with economic difficulties and now faces further uncertainty.

The international community is closely monitoring the situation as Pakistan’s economic and political future hangs in the balance.