IMF delegation to discuss Pakistan’s $1bn climate resilience funding request

February 24, 2025 (MLN): A technical delegation from the International Monetary Fund (IMF) is scheduled to begin discussions today regarding Pakistan’s request for more than $1 billion in additional funding to enhance climate resilience.

A policy review would take place early next week to evaluate the government’s performance under the existing $7bn Extended Fund Facility (EFF), following the initial talks. The government is expecting to receive between $1bn and $1.5bn.

The discussion would also cover topics such as the carbon levy, electric vehicles, and subsidies, according to the press release issued today.

Such talks are part of broader efforts to align Pakistan’s economic policies with international standards and address climate change challenges.

Last week, Finance Minister Muhammad Aurangzeb said that the IMF has expressed its willingness to provide additional funding, contingent on the implementation of tax reforms.

“It is necessary to bring reforms in the tax system. The people do not believe in the tax authority,” he said while addressing industrialists at the Faisalabad Chamber of Commerce and Industry on Saturday.

The finance minister acknowledged the “significant burden” on salaried individuals and stated that they will be required to submit their tax forms. “By November, employees from seven sectors will be able to file their forms online.”

Earlier this month, a technical delegation from the IMF has called for “stricter monitoring” of Pakistan’s public finance management, governance, and budget utilization, emphasizing the need for greater transparency and modern oversight mechanisms.

The IMF team has planned to engage primarily with several key ministries, including those of planning, finance, climate change, petroleum, and water resources.

They would also collaborate with the Federal Board of Revenue, disaster management agencies, and provincial governments.

Mahir Binici, the IMF’s resident representative in Islamabad, has confirmed that such engagements would continue over the next three weeks.

An IMF staff team is expected to arrive in Pakistan between early and mid-March to conduct discussions for the first review of the country’s EFF programme.

The talks would also address the South Asian country’s request for support under the Resilience and Sustainability Facility (RSF).

In preparation, a technical team will be in Pakistan starting in late February to tackle technical matters concerning the potential RSF arrangement.

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