The IMF report has shown the total size of the federal budget at Rs 17.6 trillion, including Rs 1.07 trillion for development spending.
New Delhi: The International Monetary Fund (IMF) has slapped 11 new conditions on Pakistan for the release of the next tranche of its bailout programme. According to a media report, the agency also warned that tensions with India could heighten risks to the scheme’s fiscal, external, and reform goals. Let’s have a look at the 11 new conditions imposed on Pakistan.
Approval of the ₹17.6 trillion budget: The IMF report has shown the total size of the federal budget at Rs 17.6 trillion, including Rs 1.07 trillion for development spending.
Agricultural Income Tax reforms: A new condition has also been imposed on the provinces where the four federating units will implement the new Agriculture Income Tax laws through a comprehensive plan, including the establishment of an operational platform for processing returns, taxpayer identification and registration, a communication campaign, and a compliance improvement plan.
Governance Action Plan: The Pakistan government will publish a governance action plan based on the recommendations of the Governance Diagnostic Assessment by the IMF.
Maintain real purchasing power: To maintain the real purchasing power of the people of the nation, IMF has directed Pakistan to give annual inflation adjustment to the unconditional cash transfer programme.
Post-2027 financial sector strategy: It will prepare and publish a plan outlining the government’s post-2027 financial sector strategy, outlining the institutional and regulatory environment from 2028 onwards.
Electricity Tariff: It will issue notifications of the annual electricity tariff rebasing by July 1st of this year to maintain energy tariffs at cost recovery levels.
Semi-annual Gas Tariff: The Pakistan government will issue a notification on semi-annual gas tariffs to maintain the energy tariffs at cost recovery levels by February 15, 2026.
Power Levy: According to the IMF, Parliament will also adopt legislation to make the captive power levy ordinance permanent by the end of this month.
Remove cap on debt service surcharge: Parliament will also adopt legislation to remove the maximum Rs 3.21 per unit cap on the debt service surcharge, which is tantamount to punishing honest electricity consumers to pay for the inefficiency of the power sector.
Special Technology Zones: The IMF has also imposed a condition that Pakistan will prepare a plan based on the assessment conducted to fully phase out all incentives in relation to Special Technology Zones and other industrial parks and zones by 2035.
Used-car import: The IMF has asked Pakistan to submit to the Parliament all required legislation for lifting all quantitative restrictions on the commercial importation of used motor vehicles (initially only for vehicles less than five years old by the end of July.
