ISLAMABAD: Finance Minister Muhammad Aurangzeb on Wednesday expressed optimism that Pakistan’s ongoing talks with the International Monetary Fund (IMF) were progressing in the right direction as the Fund reviews the country’s $7.1 billion Extended Fund Facility (EFF) and $1.1bn Resilience and Sustainability Facility (RSF).
Speaking to reporters after a meeting of the Senate Standing Committee on Finance and Revenue, Aurangzeb said the discussions with the IMF mission, led by Iva Petrova, had so far been constructive. So far, so good. Whatever discussions are happening, they are moving in the right direction, he remarked.
The IMF delegation began its two-week visit to Islamabad on Monday to assess Pakistan’s performance under the EFF and RSF. The review covers the fiscal year ending June, during which Pakistan met its power sector benchmarks but missed revenue collection targets by nearly Rs1.2 trillion almost 1pc of GDP. The Federal Board of Revenue (FBR) has already recorded a shortfall of Rs198bn in the first quarter of the current fiscal year.
Aurangzeb reiterated the government’s commitment to raising FBR’s tax-to-GDP ratio to 11pc by the end of this fiscal year, stressing that the resolution of pending court cases could help narrow the gap. We want to remain very committed to that target, he said.
If Pakistan successfully completes the review, it will qualify for the release of around $1bn (equivalent to 760 million Special Drawing Rights) by the end of next month. The IMF programme, signed in July last year, aims to stabilise Pakistan’s macroeconomic framework while fostering inclusive and resilient growth.
In May this year, the IMF also approved an additional $1.4bn loan under the RSF to strengthen Pakistan’s climate resilience, but disbursements remain contingent on satisfactory progress under the EFF.
The mission is expected to hold extensive discussions over corrective measures to address revenue shortfalls and accelerate the implementation of reforms ahead of the December 2025 benchmarks.