Pakistan holds kick-off meeting with IMF Mission

March 02, 2026 (MLN): Pakistan kicked off formal discussions with a visiting International Monetary Fund mission, showing a critical juncture in the country’s IMF-supported economic program.

The IMF delegation will conduct the Third Review under the Extended Fund Facility (EFF) and Second Review under the Resilience and Sustainability Facility (RSF).

The review discussions are being held in Islamabad and are led by IMF mission chief Ms. Iva Petrova, with participation from senior members of Pakistan’s economic team, including Finance Minister Senator Muhammad Aurangzeb, officials from the State Bank of Pakistan, and the Federal Board of Revenue.

Key areas of focus include fiscal performance, social spending, and implementation of structural reforms aimed at sustaining investor confidence.

The talks are also examining revenue mobilization efforts, improvements in tax administration, rationalization of federal expenditures, and progress on energy sector reforms to contain circular debt and improve efficiency.

Pakistan has recorded its first current account surplus in 14 years, while the primary fiscal surplus reached 1.3% of GDP in FY2025, reflecting improved fiscal management.

Highlighted that strengthened fiscal discipline, expenditure controls, and better revenue collection have helped create buffers under the IMF-supported framework.

Inflation has remained relatively contained, and policymakers have concentrated on stabilizing the economy, supporting energy, agriculture, and manufacturing sectors, and attracting foreign investment.

Improved investor sentiment and renewed participation in domestic capital markets have been cited as early signs of confidence following macroeconomic stabilization.

IMF officials have previously noted that Pakistan must now shift from short-term stabilization to an export-led growth trajectory to translate macroeconomic gains into higher productivity, employment, and investment.

In this context, discussions are also focusing on tariff rationalization, trade facilitation measures, and structural reforms designed to enhance competitiveness and reduce reliance on imports.

Discussions during the mission are also expected to cover governance reforms, social protection measures to shield vulnerable segments of society, and climate resilience initiatives under the RSF arrangement.

Successful completion of the review would pave the way for the release of the next tranche of funding, bolstering foreign exchange reserves and reinforcing balance-of-payments stability.

The IMF team and Pakistani authorities are expected to continue consultations in the coming days, with the outcome of the review seen as critical for maintaining external financing flows and preserving macroeconomic stability.

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