ISLAMABAD- International Monetary Fund has in principle endorsed Pakistan's home-grown economic stabilization package and agreed to provide US $ 4.6 billion within 14 days of a formal request. Reliable sources in the Finance Ministry told TheNation that the Fund "by and large accepted the home grown plan" and would formally endorse it on November 7 when the IMF Board of Directors will meet in Washington.  Hitherto, Pakistan has not formally applied for the loan but completed discussions to get early release of funds if it needed the money. The sources said Pakistan has to apply before the November 7 IMF meeting if it wanted to enter into the programme. Pakistan and the IMF held discussions in Abu Dhabi for about ten days on economic stabilization package and its formal approval would open doors for much-needed dollars to overcome grave economic crisis. The sources said conditional to the Fund's Board of Directors' approval, the IMF has agreed to give US $ 4.6 billion and a first tranche of $ 3.2 billion would be directly transferred to the State Bank of Pakistan's account within 14 days of the formal application. The remaining amount would be given in two equal tranches. The volume of the total Fund loan would again depend upon the availability of resources to the Fund, as some other countries have also requested for the exceptional funding, said the sources. The United States enjoys the majority voting rights on the IMF Board of Directors. The US Ambassador to Pakistan, Anne W Peterson, held an important meeting a few days back with Advisor to PM on Finance, Shaukat Tarin. Pakistan would get the Fund assistance under Stand-By Arrangement, which carries about 5 per cent interest rate and no cap on borrowing. With a formal approval of the economic stabilization plan, the doors of international financial institutions are also opened for Pakistan. It would get about $ 3 billion from various multilateral donors. "We have minimized the conditions and the Fund agreed with what Pakistan proposed", said the sources and added this time the IMF delegation was soft in discussions, which was even against the Pakistani authorities expectations. The Pakistani authorities have agreed to keep the budget deficit at 4.3 per cent of the total size of the economy, which comes to around Rs 525 billion. The Current Account Deficit would be minimized to 6.5 per cent of the Gross Domestic Product i.e $ 10.5 billion. On the revenue side, both the parties agreed that Islamabad would collect taxes equal to 10.2 per cent of the total size of the economy, which in absolute terms amounts to about Rs 1300 billion. In this budget, the government gave Rs 1250 billion collection target to Federal Board of Revenue. The sources said the IMF projected that Pakistan's economy would grow by 3 per cent but the authorities made them agree that the economy would grow by 3.5 per cent. "The fiscal deficit was the major concern of the IMF", they added. They also sought from Pakistan to bring in fast paced administrative reforms to control current expenditure and an ownership of the programme by the political leadership, the sources said. So far, Pakistan has not agreed on the IMF demand of further increasing electricity tariffs and interest rate, said the sources and added, the authorities conveyed to them that people were already demonstrating against recent tariffs' hike. The sources said the IMF asked Pakistan to immediately increase interest rate by 350 basis points or 3.5 per cent to control inflation but the Governor State Bank, Dr Shamshad Akther, in return said that she would take appropriate policy measure at an appropriate time. Inflation in Pakistan is hovering around 25 per cent and the interest rate is 13 per cent. The IMF sought from Pakistan to jack up the rate to curtail inflation and give better return to depositors to encourage saving culture. On exchange rate, the source quoted the Governor of SBP, who said the central bank would ensure flexible exchange rate but at the same time would not allow free fall of rupee. Pak rupee shed its value by more than 25 per cent during last few months. This also added Rs 900 billion in Pakistan's debt burden. A single rupee decline in value of local currency adds Rs 46.7 billion in the external debt.