Pakistan likely to pass 1st $7bn IMF loan review amid revenue progress

March 05, 2025 (MLN): Pakistan is likely to pass the first review of its $7 billion loan program with the International Monetary Fund (IMF) since it has made enough progress to raise revenue.

Prime Minister Shehbaz Sharif has approved a law to tax agricultural income, attempted to sell a stake in state-owned Pakistan International Airlines Corp (PSX: PIAA), and taken steps to meet an ambitious tax target.

These developments have been presented to the IMF, the people said, asking not to be identified because the discussions are private, according to Bloomberg.

An IMF team led by Mission Chief to Pakistan Nathan Porter is in Pakistan this week to meet with government officials and assess their progress in meeting the loan conditions.

If the IMF approves the first review of the loan, the country is in line to receive about $1bn as the second installment of the loan package.

The IMF review is being closely watched by investors as a sign of progress in economic reforms.

Prime Minister told the global lender’s Managing Director Kristalina Georgieva last month his government plans to submit a plan to boost economic growth after achieving stability.

The IMF chief said in an X post the lender was encouraged by Pakistan’s strong commitment and reforms.

A team from Pakistan led by Finance Minister Muhammad Aurangzeb started the “kick-off meeting” with the IMF team on Tuesday, the ministry said in a statement.

Aurangzeb said in an interview last month that the country will meet its revenue goals for the fiscal year to June, and any shortfall will be met by expanding the tax net.

He has separately said the nation is confident it can meet other targets of the program, Bloomberg added.

Pakistan was able to build some trust with the IMF by completing a short-term nine-month program last year.

Previous loan programs in Pakistan ended prematurely or saw delays after the governments faltered in meeting key conditions.

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