ISLAMABAD: The Pakistan government is preparing to secure maximum relief during the upcoming IMF review, focusing on the impact of recent floods and heavy rains.
Prime Minister Shehbaz Sharif has instructed authorities to negotiate broader concessions during the IMF review. Officials aim to prevent the imposition of a mini-budget by proposing alternative revenue measures. Strict enforcement of existing tax policies will be presented to satisfy IMF concerns without raising new taxes.
The Ministry of Finance is also seeking relief for flood-affected households. Discussions will include easing electricity bills and proposing concessions on the repayment of agricultural loans. Officials will highlight the financial burden caused by the natural disasters to strengthen Pakistan’s case during the IMF review.
Sources said the government plans to request a downward revision of the Federal Board of Revenue’s (FBR) tax targets. Shortfalls in tax collection linked to flood-related disruptions will be presented as justification. A detailed briefing will also inform the IMF about the decline in tax revenues and its impact on overall fiscal performance.
Additionally, the government may propose a slight revision of the GDP growth target while persuading the IMF to avoid new tax measures. Consideration will also be given to increasing federal expenditures for rehabilitation and reconstruction efforts after the floods.
The IMF review is seen as a critical stage for Pakistan’s ongoing Extended Fund Facility (EFF) program. Officials are hopeful that highlighting the exceptional circumstances of the floods will result in more flexible terms, allowing the government to manage both fiscal responsibilities and urgent relief measures.
Analysts say the upcoming IMF review could influence Pakistan’s economic trajectory, as concessions on taxation, public spending, and loan repayments would provide significant relief to citizens and businesses affected by natural disasters.
The government continues to emphasize proactive dialogue with the IMF, aiming to balance fiscal discipline with immediate humanitarian needs during the challenging monsoon season.
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