ISLAMABAD: The International Monetary Fund (IMF) concluded its mission to Pakistan on Thursday, with authorities reaffirming their commitment to a 2% primary surplus target for fiscal year 2027, part of broader efforts to stabilize the nation’s economy.
The IMF mission, led by Iva Petrova, held talks in Islamabad from May 13 to May 20, focusing on economic developments, budget strategy for FY2027, and structural reforms under Pakistan’s Extended Fund Facility and Resilience and Sustainability Facility.
“The authorities reaffirmed their commitment to a primary surplus target of 2% of GDP in FY2027, which will support fiscal sustainability and continue to build resilience,” Petrova said in a statement.
The IMF said the State Bank of Pakistan (SBP) vowed to maintain a tight monetary policy stance to anchor inflation expectations and would continue monitoring second-round effects from energy price increases. The central bank also backed exchange rate flexibility as a key shock absorber and called for a deeper foreign exchange interbank market.
Discussions also covered energy sector reforms, restructuring of state-owned enterprises, product market liberalization, and financial sector improvements.
Under the RSF, officials reviewed plans to adopt a disaster risk financing framework, integrate climate considerations into budget planning, and advance power subsidy reforms.
The IMF thanked federal and provincial authorities for their “constructive engagement, strong collaboration, and continued commitment to sound policies.”
The next mission, including the Article IV consultation and reviews of the EFF and RSF, is expected in the second half of 2026.
Earlier this month, the IMF approved the latest review of Pakistan’s reform program, clearing disbursements of about $1.1 billion from the EFF and $220 million from the RSF, bringing total payouts under the two arrangements to roughly $4.8 billion.
The IMF has set Pakistan’s federal revenue target at 17.145 trillion rupees for FY2027. Provinces have been asked to increase their revenue contribution by at least 400 billion rupees, nearly 40% of their existing share, through more effective collection in agriculture, property, and services sectors.
