• Meets IMF delegation, says country on road to economic progress
• Govt seeks relief measures in budget; Fund reviewing proposals

ISLAMABAD: Amid week-long talks with the International Monetary Fund (IMF) on next fiscal year’s budget, Prime Minister Shehbaz Sharif on Thursday reaffirmed Pakistan’s commitment to fast-track institutional reforms and maintain macroeconomic stability.

During a meeting with an IMF delegation led by Regional Director for the Middle East and South Asia, Jihad Azour, the prime minister said the country was now firmly on the path of economic development after a period of recovery and stability.

“By the grace of Allah, Pakistan is now moving from economic stability towards sustainable growth,” PM Shehbaz said in an official statement.

He said the government’s top priority was to sustain macroeconomic gains and expedite comprehensive institutional reforms, crucial for long-term resilience.

The high-level meeting took place at the last leg of negotiations between an IMF staff mission and Pakistan’s economic team to finalise next year’s budget in line with commitments made as part of the $7 billion Extended Fund Facility. The IMF mission has been in formal engagements with authorities since May 14 and is slated to conclude the visit on Friday (May 23).

The Fund wants the initial achievements under the programme to move into the next phase without compromising programme objectives. Central to that phase include effective implementation of Agricultural Income Tax across provinces, tangible recoveries from the retail sector alongside expansion of the tax net, financial devolution, and greater contribution from provinces for national security.

The engagements are likely to continue virtually until the announcement of the federal and provincial budgets and their passage by parliament to ensure no lapses from agreed budgetary propositions.

Sources said Pakistan has proposed modest relief measures in the upcoming budget, including a slight reduction in super tax, incentives for the real estate sector and relief for the salaried class.

However, the IMF has yet to reach a conclusion and is still examining the viability of such measures in the context of revenue target and expenditures and possible recoveries from litigation cases.

During the meeting, also attended by ministers for finance, planning, and economic affairs, besides the finance secretary and the FBR chairman, the discussions focused on the implementation and progress of the ongoing IMF loan programme. Both sides expressed satisfaction over the economic reforms undertaken by the government and their accruing positive outcomes, the official statement said.

The IMF delegation acknowledged the progress made under the reform agenda and assured the prime minister of continued support from the Fund in the country’s efforts for economic stability and inclusive growth, the statement added.

PM meets WB team

Separately, the prime minister also met a World Bank delegation led by Managing Director of Operations Anna Bjerde on Thursday and assured her of the steadfast implementation of the economic reform programme necessary to build a solid and sustainable growth. He told the delegation that the government was taking practical steps to achieve maximum benefits from the World Bank’s development investment.

He hoped that the World Bank’s Country Partnership Framework would bring more than $20bn in development investment to Pakistan and appreciated the World Bank’s assistance to the victims of the 2022 floods in Pakistan that had impacted millions of people, destroying livelihoods and properties.

Ms Bjerde said that the World Bank valued its historic partnership with the government of Pakistan for the development and prosperity of its people. She also expressed gratitude to Prime Minister Shehbaz for his effective role in strengthening the partnership and implementing the Country Partnership Programme.

Also appreciating Pakistan’s recent exemplary economic performance and stability, she said that through its positive actions for macroeconomic stability, Pakistan had achieved the impossible and the bank looked forward to continued cooperation to achieve the positive outcomes of the Country Partnership Framework and uplift the Pakistani people for which policy continuity for sustainable and inclusive growth was necessary.

Published in Dawn, May 23rd, 2025