ISLAMABAD – Pakistan has introduced a Fiscal Risk Monitoring Framework to fulfill a key commitment to the International Monetary Fund (IMF). The system aims to identify and manage financial risks tied to public-private partnership (PPP) projects across the country.
According to the Ministry of Finance, the framework will assess fiscal risk from PPP projects and require the federal and provincial governments to submit detailed reports every six months. Officials said this step marks a significant move toward greater transparency in public finances.
Official documents show that contingent liabilities from PPP projects have exceeded Rs472 billion. Of this total, Rs368 billion is classified as emergency or contingent liabilities, while over Rs150 billion has arisen due to cost escalations in development projects.
Financial guarantees, which account for Rs104 billion, represent one of the main fiscal risk factors. Other risks include minimum income guarantees, interest rate fluctuations, dollar appreciation, and rising project costs, all of which could amplify government exposure.
The framework analyzed 36 PPP projects nationwide, providing Pakistan’s first consolidated view of PPP-related financial pressure. Officials noted that these risks were previously not immediately visible in federal or provincial budgets, creating potential gaps in fiscal planning.
The report highlights Sindh as the province with the highest financial exposure, with PPP liabilities totaling Rs335.6 billion. The federal government accounts for Rs90.6 billion, while Punjab’s exposure is Rs26.5 billion.
Under the new system, all PPP-related financial risks and potential debt will be formally reported in fiscal documents. Authorities said this will prevent unexpected financial shocks and improve long-term budget management.
The Ministry of Finance emphasized that the Fiscal Risk Monitoring Framework aligns Pakistan’s reporting standards with international best practices. It is expected to strengthen transparency, support IMF program requirements, and help policymakers better manage the country’s growing development financing needs.
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Officials said the framework will allow early detection of fiscal stress and provide policymakers with tools to mitigate risks before they impact national budgets.
