Pakistan, International Monetary Fund begin technical-level talks, with discussions focused on fiscal performance
ISLAMABAD
Pakistan and the International Monetary Fund (IMF) began technical-level talks on Thursday, with discussions focused on fiscal performance, revenue collection, expenditure trends, and external financing, According to officials, the IMF raised concerns over a revenue shortfall of Rs1.2 trillion faced by the Federal Board of Revenue (FBR) in FY2024-25 against its original Rs12.97 trillion target.
Despite Rs1.3 trillion in additional taxes, the FBR collected Rs11.74 trillion after two downward revisions. Officials attributed part of the gap to Rs250 billion in pending recoveries from court cases. Simultaneously, Pakistan secured $1.377 billion in external loans during July and August of the current fiscal year (FY2025-26), against a full-year projection of $19.9 billion.
Bilateral inflows totalled $232 million, including $200 million from Saudi Arabia under an oil facility. Multilateral creditors, including the World Bank, Asian Development Bank, Asian Infrastructure Investment Bank, and Islamic Development Bank, disbursed $780 million, with the World Bank as the lead contributor.
Discussions also covered National Finance Commission (NFC) distribution, fiscal developments, revenue performance, pending litigation, foreign exchange reserves, and the policy rate.
The government shared plans to revise the NFC Award formula, potentially reducing the population-based share for provinces, currently 82%, and introducing weightage for tax performance and low population density.
