Key Takeaways
- Pakistan and IMF expected to finalize review talks this week for fifth loan tranche.
- FBR assured of achieving tax collection target for current fiscal year.
- IMF stressed the need for continued reforms in the energy sector.
Pakistan and the International Monetary Fund (IMF) are set to conclude review talks this week for the release of the fifth tranche under the ongoing loan program, according to sources.
The Federal Board of Revenue (FBR) has assured the IMF that it will meet the tax collection target for the current fiscal year, a key requirement for the disbursement of the loan.
During the technical-level discussions, the IMF mission expressed satisfaction with the progress made so far, particularly in the performance of the power sector, which has seen improvements in tax collection during the July-September quarter.
However, the IMF has emphasized the need for further measures to reduce circular debt and losses in power distribution companies (DISCOs), and to complete steps related to their privatization.
The IMF mission has also stressed the importance of continued reforms in the energy sector, with discussions on additional measures to be finalized during policy-level negotiations.
Sources indicate that the release of the fifth tranche will remain subject to approval by the IMF Executive Board, contingent upon the successful completion of the review talks.
The economic team of Pakistan has assured the Fund that a new National Finance Commission (NFC) Award will be finalized by December 2026, a commitment that is expected to bolster the overall economic reform agenda.
Following the successful completion of negotiations, the IMF mission is expected to issue a statement on the outcome of the overall review, which will pave the way for the disbursement of the fifth tranche.
The review talks are seen as a critical step in ensuring the continued support of the IMF for Pakistan’s economic recovery and reform efforts.
