IMF Concludes Pakistan Talks on Budget, Reforms and Economic Stability

ISLAMABAD: International Monetary Fund has concluded its latest mission to Pakistan after talks on economic conditions, fiscal planning and reform progress.

The IMF delegation visited Islamabad from May 13 to May 20. The discussions focused on economic developments, reform implementation and Pakistan’s budget strategy for fiscal year 2027.

Pakistan Reaffirms Fiscal Targets

IMF mission chief Iva Petrova said Pakistani authorities reaffirmed their commitment to maintaining a primary surplus target of two percent of gross domestic product in FY2027.

She said the government plans gradual fiscal consolidation through broader tax collection and improved spending efficiency.

Moreover, the IMF stressed the need to strengthen tax administration at both federal and provincial levels.

SBP to Maintain Tight Monetary Policy

According to the IMF statement, State Bank of Pakistan will continue maintaining a tight monetary policy stance to control inflation expectations.

The Fund also highlighted the importance of exchange rate flexibility to absorb economic shocks and support the foreign exchange market.

Reforms in Energy and Financial Sectors Discussed

The mission reviewed reforms in the energy sector, state-owned enterprises and financial markets.

In addition, discussions covered climate financing, disaster risk management and electricity subsidy reforms under the Resilience and Sustainability Facility.

Pakistan Receives IMF Disbursement

Earlier this month, the IMF approved Pakistan’s latest reform review.

The approval cleared disbursements of around $1.1 billion under the Extended Fund Facility and $220 million under the Resilience and Sustainability Facility.

As a result, total payouts under both programmes reached nearly $4.8 billion.

Meanwhile, the IMF set Pakistan’s federal revenue target at Rs17.145 trillion for FY2026-27.

The Fund also asked provinces to increase revenues through improved tax collection in agriculture, property and services sectors.

Next IMF Review Expected in 2026

The IMF said its next mission to Pakistan is expected in the second half of 2026.

The upcoming visit will include Article IV consultations and reviews under the IMF-supported programmes.