The International Monetary Fund (IMF) has expressed concern over continued delays in amending laws governing state-owned enterprises (SOEs), particularly the lack of an effective governance and financial framework for the Water and Power Development Authority (Wapda), according to Pakistani officials involved in the ongoing talks.
The concerns were raised during discussions on the fourth review of Pakistan’s $7 billion Extended Fund Facility. The IMF is also reviewing proposed amendments to the National Accountability Ordinance aimed at making the appointment of the National Accountability Bureau (NAB) chairman more transparent and rule-based.
Pakistan has missed successive deadlines to bring the laws of nine to 10 statutory SOEs into conformity with the main SOE Act. The latest deadline was August 2026, but the required legislative changes remain incomplete. The IMF had previously agreed to extend the deadline to allow more time for the legislative process.
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Government sources said the IMF has now asked Pakistan to complete the alignment of the relevant laws before mid-November. If the fourth review is successfully completed, the IMF Executive Board could consider the next disbursement of about $1 billion under the EFF.
The ongoing review could unlock around $1.2 billion for Pakistan, including approximately $1 billion under the EFF and $200 million under the Resilience and Sustainability Facility.
According to the latest staff-level reporting cited in the discussions, Pakistan had submitted amendments covering six SOE laws to Parliament in January. The government still needs to make progress on legislation governing the remaining entities.
Finance Secretary Imdad Ullah Bosal recently told the National Assembly Standing Committee on Finance that amendments were planned for the laws governing Port Qasim Authority, Gwadar Port Authority, Karachi Port Trust, State Life Insurance Corporation, National Telecommunication Corporation and Pakistan Railways.
Special Secretary Finance Qumar Abbasi told the committee that three of the nine required laws had already been passed, while the remaining legislation was at different stages of approval.
Wapda has emerged as one of the more difficult issues in the talks. During an earlier review, Pakistan had sought an exemption for Wapda from the requirement to amend its governing law, citing the authority’s strategic and essential functions.
Pakistani authorities subsequently assured the IMF that they would introduce measures to strengthen Wapda’s governance and financial framework. Officials, however, were unable to provide a progress update during Tuesday’s discussions, according to sources cited by The Express Tribune.
A Finance Ministry spokesperson did not respond to questions about the IMF’s discussions on Wapda. Sources said the authority remained a key point of concern for the Fund.
The IMF also reviewed Pakistan’s progress on amendments to the NAB law. The proposed changes are intended to strengthen transparency and independence in the appointment of the NAB chairman. Under the programme, Pakistan is expected to submit amendments to Parliament by January 2027. The IMF considers a transparent appointment process important for strengthening public confidence in the anti-corruption institution.
Pakistan also briefed the IMF on efforts to identify public-sector entities facing high corruption risks. NAB is developing a methodology and has selected 10 entities from an initial list of 30 for a detailed risk assessment.
The government is required to develop a corruption-risk assessment methodology by the end of October to support a NAB action plan aimed at reducing vulnerabilities across government institutions. The IMF’s programme documents identify institutional-level risk assessment and action plans for 10 high-risk agencies as part of Pakistan’s anti-corruption reform commitments.
The IMF has also raised concerns over delays in amendments to the Sovereign Wealth Fund Act. The original reform deadline was extended to March 2026. The Fund wants SOEs owned by the Sovereign Wealth Fund to remain subject to the same governance and accountability standards as other SOEs.
The proposed changes include amending Section 50 of the SWF Act to explicitly place SWF-owned SOEs under the SOE Act and SOE Policy, while establishing additional rules governing the fund’s ownership and oversight functions.
The government has already proposed amendments, with the legislation currently before the Senate Standing Committee on Finance. One proposed change concerns the treatment of dividends: under the existing framework, the SWF can retain 50% of dividends from companies it owns, while the proposed arrangement would route the income to the government before any further distribution is decided.
SOE governance is one of several structural issues being examined during the IMF’s fourth review. The Fund has previously said that bringing statutory SOEs under a common governance framework is intended to strengthen transparency, accountability and financial sustainability.
