WASHINGTON Ending a freeze on lending imposed on Pakistan after it tested nuclear weapons last May, the International Monetary Fund approved a $575 million loan aimed at helping rescue the country's shattered economy from default. An IMF statement said Friday an additional $1.11 billion would be made available to the Asian nation over the next two to three years. The decision by the IMF's Executive Board Thursday is expected to end months of uncertainty over Pakistan's ability to continue making payments on its $42 billion foreign debt.

The Asian nation's foreign exchange reserves had fallen sharply to just over $400 million, equivalent to less than two weeks of imports. It has also accumulated $1.4 billion in unpaid debts to commercial banks and other creditors since last June when international sanctions were imposed after the weapons tests. Because of Pakistan's economic plight, President Bill Clinton's administration said in November it would not stand in the way of an economic program with the IMF or the World Bank. An IMF team visited Pakistan at that time to nail down details of the loan that was then presented to the board.

The IMF agreement should clear the way for Pakistan to reach agreement with the World Bank and the Asian Development Bank on loans totaling $800 million. Pakistan also plans to seek more than $4 billion in debt rescheduling from the Paris Club of Government Lenders and Commercial Banks. (AP)