IMF wraps up Pakistan visit following talks with authorities on reforms, budget
*ISLAMABAD:* The International Monetary Fund (IMF) has concluded its mission to Pakistan after detailed discussions with authorities on economic developments, fiscal planning for the upcoming financial year, and ongoing reform progress under IMF-supported programmes.
According to a statement issued early Thursday, the IMF mission visited Islamabad from May 13 to May 20, focusing on recent economic developments, reform implementation, and the budget strategy for fiscal year 2027.
Mission chief Iva Petrova said the discussions with Pakistani authorities were “constructive,” covering economic conditions, disruptions linked to global and regional tensions, and progress under the Extended Fund Facility (EFF) and Resilience and Sustainability Facility (RSF).
She said Pakistan had reaffirmed its commitment to achieving a primary surplus of 2% of GDP in FY2027, a step aimed at strengthening fiscal discipline and economic stability.
Petrova added that gradual fiscal consolidation would be supported through expanding the tax base, improving tax administration, enhancing spending efficiency, and strengthening public financial management at both federal and provincial levels.
The IMF noted that the State Bank of Pakistan (SBP) remains committed to maintaining a tight monetary policy stance to control inflation and continues to monitor potential price pressures from energy costs.
The Fund also emphasized the importance of exchange rate flexibility and deeper development of the interbank foreign exchange market.
Discussions further included structural reforms in energy, state-owned enterprises, market liberalization, and financial sector improvements aimed at boosting investment and long-term growth.
Progress under the RSF was also reviewed, including climate-related reforms, disaster risk financing, and power subsidy restructuring.
The IMF appreciated Pakistan’s “constructive engagement and strong cooperation” and said the next review mission, including Article IV consultations, is expected in the second half of 2026.
Earlier this month, the IMF approved the latest review of Pakistan’s reform programme, unlocking $1.1 billion under the EFF and $220 million under the RSF.
The IMF also projected Pakistan’s federal revenues at Rs17.145 trillion for FY2026–27 and urged provinces to increase revenue collection by at least Rs400 billion through improved taxation in key sectors.