LAHORE
The Pakistan Industrial and Traders Associations Front has welcomed the staff-level agreement reached between International Monetary Fund and Pakistan, terming it a positive step toward economic stability and restoration of investor confidence.
According to the IMF, the agreement will unlock around $1.2 billion following the successful completion of the third review under the Extended Fund Facility (EFF) and the second review under the Resilience and Sustainability Facility (RSF).
Subject to board approval, Pakistan is expected to receive about $1 billion under the EFF and approximately $210 million under the RSF, bringing total disbursements under the programme to nearly $4.5 billion.
PIAF Chairman Faheemur Rehman Saigol, who is also LCCI President, said that the agreement reflects international confidence in Pakistan’s ongoing economic reforms and policy direction.
He noted that macroeconomic indicators have shown gradual improvement, including controlled inflation, a stable current account, and strengthening external buffers.
However, he cautioned that the government must not become complacent. “The agreement with the IMF is a step forward, but the real challenge lies in consistent implementation of reforms to ensure long-term economic sustainability,” he said.
Senior Vice Chairman Nasrullah Mughal highlighted that the IMF’s endorsement of Pakistan’s fiscal discipline and structural reforms should be seen as an opportunity to accelerate economic transformation. He stressed the importance of broadening the tax base, improving revenue collection, and ensuring transparency in financial management.
The IMF noted that Pakistan’s programme implementation remains broadly aligned with its objectives, including strengthening public finances, maintaining inflation within the target range of the State Bank of Pakistan, and advancing energy sector reforms.
Vice Chairman Tahir Manzoor Chaudhry said that while the agreement is encouraging, external risks continue to pose serious challenges. He pointed to the ongoing Middle East conflict, which could lead to volatile energy prices and tighter global financial conditions, potentially increasing inflationary pressures and impacting economic growth.
“The government must remain vigilant and proactive in managing these risks. Rising fuel costs and global uncertainty can offset the gains achieved through reforms if not handled carefully,” he added.
PIAF leaders also emphasised the need for balanced fiscal policies. The IMF has urged Pakistan to maintain a prudent fiscal stance, targeting a primary surplus of 1.6 percent of GDP in FY26 and 2 percent in FY27. This will require stronger tax collection measures, controlled expenditures, and improved coordination between federal and provincial governments.
Faheemur Rehman Saigol stressed that while fiscal consolidation is necessary, it should not come at the expense of economic growth. “The government must strike a balance between stabilisation and growth by facilitating industrial activity and supporting the private sector,” he said.
The association also welcomed the IMF’s focus on strengthening social protection programmes, particularly the Benazir Income Support Programme. Expanding coverage and improving delivery mechanisms will help shield vulnerable segments of society from the impact of rising food and fuel prices.
Nasrullah Mughal noted that increased spending on health and education is essential for long-term development. “Human capital investment is critical for sustainable growth. The government must ensure that these sectors receive adequate funding despite fiscal constraints,” he said.
On monetary policy, the IMF has advised maintaining a cautious approach, with the central bank ready to adjust interest rates if inflationary pressures rise. The PIAF leadership supported this stance but urged policymakers to also consider the impact of high interest rates on business activity and investment.
Tahir Manzoor Chaudhry highlighted the importance of energy sector reforms, which remain a key focus of the IMF programme. He said that addressing circular debt, improving efficiency in transmission and distribution, and transitioning toward renewable energy are crucial for economic stability.
