Pakistan nears IMF tranche approval after key review deal

April 15, 2026 (MLN): Pakistan is nearing approval for the next tranche of its International Monetary Fund programme after reaching a staff-level agreement on key reviews, Finance Minister Muhammad Aurangzeb told global investors, showing continued external financing support as the country navigates geopolitical and fiscal pressures.

Speaking at an investor roundtable hosted by Jefferies International on the sidelines of the World Bank–IMF Spring Meetings 2026, the minister said Pakistan has completed the third review of its Extended Fund Facility (EFF) and the second review under the Resilience and Sustainability Facility (RSF) at the staff level.

Formal approval by the IMF Executive Board is expected shortly, which would unlock the next disbursement under the programme and bolster the country’s foreign exchange reserves.

The development is critical for Pakistan’s macroeconomic stability, as IMF inflows typically catalyze additional multilateral and bilateral financing while supporting investor confidence.

The country has remained reliant on external funding to manage its balance of payments position and maintain reserve adequacy.

Muhammad Aurangzeb told institutional investors that Pakistan had met all quantitative performance criteria and structural benchmarks required under the programme reviews, showing progress on fiscal consolidation and reform implementation.

He reiterated the government’s commitment to maintaining a primary fiscal surplus, supported by expenditure controls and targeted policy measures.

Addressing external risks, the finance minister pointed to the ongoing Middle East conflict as a key uncertainty for Pakistan’s economic outlook.

He said immediate impacts are already visible, while broader second- and third-order effects particularly through oil prices, remittances, and trade flows will depend on how long and how intensely the conflict persists.

On the policy front, the government has introduced fiscally neutral targeted subsidies to cushion vulnerable segments, alongside rationalization of development spending and wider austerity measures at the federal level.

These steps are aimed at preserving fiscal discipline under the IMF programme while limiting inflationary pressures.

In parallel, Pakistan is preparing to re-enter international capital markets.

Muhammad Aurangzeb said the government is reviving its Global Medium-Term Note (GMTN) programme and has initiated the process to appoint lead managers for potential issuances, including Eurobonds, Sukuk, and dollar-settled rupee-linked instruments.

He also confirmed plans for the country’s debut Panda bond issuance in China’s domestic market, pending regulatory approvals.

The investor interaction concluded with strong engagement, showing continued interest in Pakistan’s reform trajectory, external financing plans, and macroeconomic outlook as the country works to stabilize its economy under the IMF framework.

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