The European Union (EU) under its Public Financial Management Support Program is supporting Pakistan in improving fiscal policies and budget preparations with a grant of 13 million euros, the Ministry of Finance, Revenue and Economic Affairs of Pakistan said on Friday.

The grant will help enhance public financial management, improve the effectiveness of government spending, and the delivery of public services for both the federal government and provincial governments of Pakistan, the ministry said in a statement.

The agreement was signed here by Secretary Economic Affairs Division Syed Pervaiz Abbas and EU's Ambassador to Pakistan Androulla Kaminara, whereas Pakistani Federal Minister for Economic Affairs Muhammad Hammad Azhar witnessed the signing ceremony.

While highlighting the need to strengthen the social and economic partnerships with the EU, Azhar said that Pakistan has to make socio-economic progress a reality which would play a pivotal role to stabilize the country's economy.

The announcement of the funding came after Pakistan and the International Monetary Fund have reached a staff-level agreement on "policies and reforms needed to complete the second review of reform program" on Thursday, according to local media reports.