Pakistan’s economic challenges have entered a critical phase after the International Monetary Fund set fresh conditions for the next loan installment. The IMF has placed 23 new requirements before Islamabad. These conditions must be met to secure the upcoming tranche. Many of the proposed measures could increase the cost of living for ordinary citizens.
The country already struggles with inflation and weak growth. Rising food and energy prices have reduced household purchasing power. The new IMF conditions may intensify these pressures in the coming months.
Tax Measures and Impact on Daily Living
The IMF has advised the government to introduce new tax measures. Sources say an 18 percent sales tax may be imposed on several goods. This step could raise prices across multiple sectors. Consumers may feel the impact quickly.
The IMF has also proposed a 5 percent federal excise duty on fertilisers and agricultural pesticides. Farmers may face higher production costs. These costs could later shift to consumers through higher food prices.
Another key condition involves ending the wheat support price. The IMF wants market-based pricing for wheat. This change may affect farmers’ income stability. It could also increase flour prices in local markets.
The IMF has further recommended bringing high-value surgical items under the sales tax net. This move may increase healthcare costs. Patients may struggle with more expensive medical treatment. Private healthcare providers could raise fees as a result.
Energy and State-Owned Enterprise Reforms
Energy sector reforms remain central to IMF demands. The IMF has called for tariff adjustments and cost-reduction measures. These reforms aim to reduce circular debt. However, electricity and fuel bills may rise further.
Households already face high utility charges. Any increase could deepen financial stress. Small businesses may also struggle with higher operating costs.
State-owned enterprises remain another major concern. The IMF has asked Pakistan to complete reforms in these entities by 2026. Many state-run companies continue to drain public funds. Legal and structural changes are required to improve efficiency and reduce losses.
Social Protection and Economic Balancing
To soften the impact on low-income groups, the IMF has proposed expanding the Benazir Income Support Programme. The programme could cover 10.2 million beneficiaries. This expansion aims to provide relief amid rising prices.
Despite this support, analysts warn of short-term hardship. Additional taxes and higher tariffs may push inflation upward. Millions of Pakistanis may face increased living costs.
The government now faces a difficult balancing act. It must meet IMF conditions to secure funding. At the same time, it must protect vulnerable citizens. The coming months will shape Pakistan’s economic future.
