ISLAMABAD (AP) — The International Monetary Fund on Wednesday approved a much-awaited $3 billion bailout for Pakistan, the global lender said, a move that's likely to save the impoverished Islamic nation from defaulting on its debt repayments.

The IMF said its executive board approved an agreement to release the funds over a nine-month period to support Pakistan's economic stabilization program.

The announcement comes less than two weeks after Pakistan and the IMF agreed to the nine-month plan following a series of meetings with Prime Minister Shehbaz Sharif, Finance Minister Ishaq Dar and other officials.

"The arrangement comes at a challenging economic juncture for Pakistan. A difficult external environment, devastating floods, and policy missteps have led to large fiscal and external deficits, rising inflation, and eroded reserve buffers" in the fiscal year 2023, the IMF said in a statement.