IMF-Pakistan talks on $7 billion programme likely to begin Sep 23

The discussions are likely to cover the fourth review of the more than $7 billion Extended Fund Facility (EFF) as well as the third review of the $1.4 billion

ISLAMABAD: Pakistan and the International Monetary Fund (IMF) are expected to begin talks on September 23 to assess the country’s progress under its ongoing financial programmes.

The discussions are likely to cover the fourth review of the more than $7 billion Extended Fund Facility (EFF) as well as the third review of the $1.4 billion Resilience and Sustainability Facility (RSF) linked to climate-related reforms.

According to sources, the two sides are expected to hold the reviews simultaneously, focusing on Pakistan’s economic performance during the second half of the previous fiscal year, covering the period from January to June 2026.

The review will assess whether Pakistan met the agreed targets and structural commitments under the IMF programmes and determine the next steps for the continuation of financial support.

The talks are expected to cover key areas of economic performance, including fiscal management, revenue collection, expenditure controls and progress on agreed reforms.

Successful completion of the reviews would pave the way for further disbursements under the respective IMF programmes, subject to approval by the Fund’s Executive Board.

Moreover, An International Monetary Fund (IMF) mission will arrive in Pakistan on September 23 to conduct a detailed assessment of the country’s economic performance and progress under its ongoing financial programmes.

The mission, led by Iva Petrova, is expected to remain in Pakistan for almost two weeks, with discussions likely to continue until the first week of October. The talks will cover the $7 billion Extended Fund Facility (EFF) as well as the $1.4 billion Resilience and Sustainability Facility (RSF).

The upcoming visit will include the fourth review of Pakistan’s EFF programme and the third review under the RSF arrangement. The discussions will assess Pakistan’s performance against targets set for the period ending June 30, 2026, while also examining the government’s plans for the current fiscal year.

The IMF team is expected to begin technical discussions at the State Bank of Pakistan. It will then hold meetings with officials from different economic ministries and departments. An opening meeting with Finance Minister Muhammad Aurangzeb is also expected as part of the review process.

Revenue collection is likely to be one of the key issues during the talks. The IMF will assess the Federal Board of Revenue’s (FBR) preparedness to meet its first half-yearly revenue collection structural benchmark under the current programme.

The revenue target is particularly significant because the FBR has faced repeated difficulties in achieving its annual collection goals. IMF officials are therefore expected to examine the measures being taken to strengthen tax collection, broaden the tax base and improve compliance.

The review will also take into account major fiscal developments involving the provinces. Provincial governments have agreed to transfer more than Rs1.035 trillion of their National Finance Commission shares to the federal government during the current fiscal year for spending related to national security and water resources.

The provinces have also committed a separate cash surplus of around Rs1.8 trillion as part of the commitments made under the IMF programme.

Pakistan’s performance against the end-June targets has generally remained on track in several areas. However, significant challenges remain, particularly on revenue collection and some policy commitments.

Government intervention in commodity markets is expected to be another important issue. The authorities’ involvement in wheat and sugar operations has raised concerns about compliance with the IMF’s requirement to limit government intervention in commodity markets.

The upcoming discussions will therefore involve both an assessment of Pakistan’s past performance and negotiations over future policy measures. The government and IMF will need to agree on how outstanding commitments will be addressed during the next phase of the programme.