An International Monetary Fund mission visiting Pakistan has concluded talks with the authorities after discussions focused on recent economic developments, fiscal planning for the next financial year, and progress on reforms under the country’s IMF-backed programmes.
During the discussions, Pakistan reaffirmed its commitment to achieving a primary budget surplus of 2 percent of gross domestic product in fiscal year 2027 as part of its broader effort to maintain fiscal discipline and support economic stability.
In a statement issued at the end of the visit, IMF mission chief Iva Petrova said the talks covered the impact of disruptions caused by the ongoing conflict in the Middle East, budget strategy for FY2027, and progress on structural reforms under the Extended Fund Facility and the Resilience and Sustainability Facility.
The IMF said the government’s planned fiscal consolidation would be backed by efforts to broaden the tax base, improve tax administration, enhance spending efficiency, and strengthen public financial management at both federal and provincial levels. Discussions on the FY2027 budget are expected to continue in the coming days.
The State Bank of Pakistan also reiterated its commitment to maintaining an appropriately tight monetary policy stance to anchor inflation expectations, while closely monitoring the potential second-round effects of higher energy prices.
According to the IMF, exchange rate flexibility should continue to serve as a key buffer against external shocks, while efforts to deepen the foreign exchange interbank market should also continue.
The talks further reviewed structural reforms in the energy sector, state-owned enterprises, product market liberalisation, and the financial sector, with the aim of supporting durable economic growth and attracting higher-quality private investment.
Progress under the Resilience and Sustainability Facility was also discussed, including efforts to develop a disaster risk financing framework, integrate climate considerations into budget and investment planning, and advance reforms related to power subsidies.
The IMF said its next mission to Pakistan is expected in the second half of 2026 and is likely to include the Article IV consultation along with reviews under the Extended Fund Facility and the Resilience and Sustainability Facility.
