An International Monetary Fund (IMF) review mission will arrive in Pakistan tomorrow (Thursday) to conduct a two-week assessment of the country’s economic progress under the ongoing $7 billion loan program.
The visit will determine Pakistan’s eligibility for the next $1 billion tranche.
IMF review mission begins visit
According to the Finance Ministry, the IMF team will stay in Pakistan for nearly two weeks. The mission will hold a series of discussions to review Pakistan’s compliance with loan conditions and its overall economic performance.
The visit will include first technical talks followed by policy-level negotiations. Data covering January to June 2025 will be presented in technical talks, while first-quarter results of the current fiscal year will also be evaluated.
Policy discussions, role of finance minister
Finance Minister Muhammad Aurangzeb is expected to lead Pakistan’s side during the policy-level meetings. These talks will play a crucial role in securing the board’s approval for the release of the next $1 billion tranche.
Also Read: Pakistan meets most IMF conditions ahead of review mission
So far, Pakistan has already received $2.1 billion under the agreement signed in September 2024.
Climate financing, reform measures
Beyond fiscal targets, the IMF mission will also review Pakistan’s progress on climate change measures. The Fund has previously approved $1.4 billion under the Resilience and Sustainability Facility (RSF) and provided additional approval for climate financing, contingent upon Pakistan’s performance under the Extended Fund Facility (EFF).
Finance Ministry confident on targets
Officials at the Finance Ministry have indicated that Pakistan has met most of the IMF’s targets, increasing optimism for a successful outcome. If the talks progress smoothly, the IMF Executive Board will formally approve the release of funds.
Last week, the FBR chairman had clarified that the government planned to meet revenue targets through tax enforcement and compliance measures rather than burdening citizens with fresh levies. The IMF would be persuaded that instead of a mini-budget, revenue would be enhanced by strictly implementing tax measures, sources said.
Also Read: No mini-budget, IMF to be briefed about other plans: FBR chief
Langrial had said that it was too early to comment on changes to the annual tax revenue target, which could be reviewed after discussions with the IMF.
Relief measures on table
Sources within the Finance Ministry had revealed that Pakistan would push for significant relief from the IMF during the upcoming review. Among the proposals under discussion:
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Relief in electricity bills for flood-affected households in September.
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Easing repayment of agricultural loans for farmers hit by the disaster.
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Adjustments in tax targets for the FBR, briefing on shortfall in collections.
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Acknowledgment of flood-related revenue losses in fiscal planning.
A slight reduction in the economic growth target was also expected to be discussed.
Strategy for IMF talks
Officials said the government would present the IMF with a detailed plan to boost revenues through strict enforcement of existing tax measures, rather than introducing new taxes.
The IMF would also be briefed on the tax shortfall faced by the FBR and the broader economic impact of the floods, which undermined collection targets.
PM Shehbaz’s directives
Prime Minister Shehbaz Sharif has reportedly directed negotiators to make a strong case for Pakistan’s economic relief, stressing that the floods had placed immense pressure on households, agriculture, and the overall economy.
The Finance Ministry, sources added, was determined to convince the IMF that revenue gains could be achieved without further taxation, while still protecting vulnerable communities.
