The International Monetary Fund has reaffirmed support for Pakistan’s fiscal stability efforts and agreed to continue discussions with authorities on the upcoming federal budget and economic reforms.
An IMF mission led by Eva Petrova visited Islamabad from May 13 to 20 to review recent economic developments, reform progress and budget planning for fiscal year 2027.
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According to a statement issued after the visit, discussions focused on the impact of ongoing tensions in the Middle East, preparations for the next federal budget and progress under Pakistan’s reform agenda linked to the Extended Fund Facility (EFF) and Resilience and Sustainability Facility (RSF).
The IMF urged Pakistan to continue policies aimed at strengthening fiscal stability by broadening the tax base, improving tax administration, enhancing expenditure efficiency and implementing stronger public financial management practices at both federal and provincial levels.
Officials from Pakistan also reaffirmed their commitment to achieving a primary budget surplus equivalent to 2 per cent of gross domestic product in the next fiscal year. The IMF noted that gradual fiscal consolidation would help improve economic resilience and maintain macroeconomic stability.
The talks come as Pakistan continues efforts to stabilise its economy through structural reforms, revenue enhancement and expenditure controls while managing inflationary pressures and external financing needs.
The IMF delegation described the discussions with Pakistani authorities as constructive and confirmed that negotiations regarding the fiscal year 2027 budget strategy would continue in the coming days.
Economic analysts say continued IMF engagement remains important for investor confidence and financial stability, particularly as Pakistan navigates regional uncertainties and domestic economic challenges.
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The government is expected to finalise budget proposals after further consultations with the IMF ahead of the formal presentation of the federal budget.
Officials have not yet disclosed the full details of proposed fiscal measures, but emphasis is expected to remain on revenue generation and economic reform initiatives.