ISLAMABAD: A team of the International Monetary Fund is arriving in Pakistan on the 26th of this month. The IMF team will assess the economic progress and reforms in Pakistan.
Iva Petrova is leading the IMF team. The review is part of the $7 billion Extended Fund Facility and the $1.1 billion Resilience and Sustainability Facility. The visit will run until March 11 and carry added weight, as both sides plan to discuss budget proposals for fiscal year 2026-27, especially provincial finances.
Authorities say programme performance through December 2025 has largely stayed on track despite a revenue shortfall. However, officials expect improvement after a favourable super tax ruling. Meanwhile, the power sector will face close scrutiny due to recent policy volatility, including industrial tariffs and residential fixed charges, even though circular debt remains within targets.
Performance mixed despite strong metrics
Pakistan has met most quantitative performance criteria for end-December 2025. Nevertheless, it trails behind on indicative targets and structural benchmarks, which may complicate future implementation. Since the reviews are biannual, both sides must align on past performance and future reforms. If the review concludes successfully, Pakistan could unlock about $1 billion under the EFF and $200 million under the RSF by late April.
Brokerage firm Topline Research expects Pakistan to meet nearly all quantitative targets, though data for one indicator remains unclear. It noted the targeted cash transfer floor was missed earlier, but attributed the gap to lower administrative spending rather than reduced beneficiary support.
Topline added that net international reserves may remain slightly below benchmarks, while net domestic assets at the State Bank of Pakistan should stay comfortably under ceilings. It also projected primary surpluses exceeding targets. However, the Federal Board of Revenue missed indicative goals by Rs336 billion, though some recovery may follow the super tax ruling.
