IMF team to arrive in Pakistan next week with mini-budget talks on cards
1. Mission is not a part of first review under EFF, which will be no earlier than first quarter of 2025, say top sources
The International Monetary Fund (IMF) is sending an emergency mission to Islamabad next week to discuss Pakistan’s economic performance following significant deviations from set targets. According to *The News*, IMF officials will visit Pakistan from November 11-15 to assess recent fiscal developments and gauge the progress of Pakistan’s economic program. This visit is not part of the formal review under the Extended Fund Facility (EFF), expected no sooner than the first quarter of 2025.
*The News* previously reported that IMF’s mission could be deployed following a noticeable shift in Pakistan’s fiscal data. Sources close to the IMF confirmed this is an emergency mission prompted by unsuccessful virtual discussions regarding Pakistan's commitment to corrective measures.
During the first quarter (July-September), Pakistan’s fiscal results showed a rare surplus driven by non-tax revenue from the State Bank of Pakistan (SBP), reversing a 20-year trend of quarterly deficits. However, the Federal Bureau of Revenue (FBR) reported a shortfall of Rs321 billion for the first half of the fiscal year, with Rs189 billion already missed by October.
Other macroeconomic indicators, such as Large-Scale Manufacturing (LSM) growth and inflation, fell short of targets, and declining imports further impacted the economy. Development spending under the Public Sector Development Program (PSDP) was also minimal, with only Rs22 billion spent out of a budgeted Rs1,100 billion for the year.
Former Ministry of Finance advisor Dr. Khaqan Najeeb noted that the 37-month EFF is one of Pakistan’s most stringent IMF programs, with a unique focus on provincial performance as well. The IMF’s visit aims to review Pakistan’s progress on indicative targets, performance criteria, and structural benchmarks, especially for the period from July through December 2024. Mid-year evaluation allows time to introduce new measures if Pakistan is to meet its fiscal year 2025 goals.
This proactive visit underscores the IMF’s commitment to closely monitor Pakistan’s reform implementation, especially in governance, social, monetary, and energy sectors, as well as in state-owned enterprises and investment policies. Additionally, the planned privatization of Pakistan International Airlines (PIA), announced in August, is expected to be discussed. Dr. Najeeb suggested that a face-to-face meeting could facilitate a more comprehensive exchange, particularly regarding the dynamic aspects of Pakistan's economic policies.
