IMF slaps Pakistan with 11 more conditions! $7 billion bailout on line; total regulations stand at 64

The International Monetary Fund hit Pakistan with 11 fresh conditions, linked to its $7-billion bailout programme. The latest directives, revealed in the Fund’s staff-level report for the second review released on Thursday, push the total number of conditions to 64 across the span of 18 months, according to the Express Tribune.

The new measures target long-standing governance flaws, entrenched corruption risks and losses in critical sectors. A key requirement is the publication of asset declarations of high-level federal civil servants by December next year on an official government website. The IMF says the disclosures are meant to help detect discrepancies between income and assets.

The government intends to extend this obligation to senior provincial officials as well, while banks will be granted full access to the data.


Here are what some of the conditions focus on:

Corruption

The report states that by October next year, Islamabad must release an action plan to tackle corruption risks in 10 departments identified through institutional risk assessments. The National Accountability Bureau will be responsible for coordinating these plans for the most vulnerable agencies. According to The Express Tribune, provincial anti-corruption bodies will also take on expanded functions, including receiving financial intelligence and gaining continued support to improve their ability to investigate financial offences. These steps follow the IMF-backed Governance and Corruption Diagnostic Assessment, which highlighted wide-ranging deficiencies in Pakistan’s legal, administrative and oversight frameworks.

Cross-border payments

The lender has further directed Pakistan to complete by May next year a comprehensive review of the cost of foreign remittances and the structural barriers affecting cross-border payments, supported by an action plan. The instruction comes amid estimates that remittance costs could climb to $1.5 billion over the next few years, even as these inflows remain the country’s largest source of financing for its restricted imports.

Bond market

Another requirement, due by September next year, obliges the government to examine obstacles limiting the development of the local currency bond market and to publish a strategic plan outlining needed reforms.

Sugar industry

In an attempt to dismantle the concentration of power in the sugar sector, both federal and provincial administrations must agree on a national sugar market liberalisation policy by June next year. The federal cabinet is expected to adopt the policy, which must cover licensing rules, price controls, permissions for imports and exports, zoning criteria and clear timelines for implementation.

Tackling FBR's poor efficiency

The Federal Board of Revenue (FBR), frequently criticised for poor performance, has been handed a demanding set of tasks. By the end of December this year, the government must complete a reform roadmap that outlines priority areas, staffing needs, timelines, milestones, expected revenue outcomes and KPIs. Based on this roadmap, Pakistan will then be required to fully implement all necessary steps, such as subordinate legislation, staffing changes and initial reporting, across at least three priority reforms agreed with IMF staff.

Tax reforms

By December next year, the authorities must also publish a medium-term tax reform strategy setting out a phased plan that covers tax policy, tax administration and legal amendments, as well as governance and resourcing arrangements.

Power sector in focus

The government, before the next federal budget, must establish the groundwork for private-sector participation in HESCO and SEPCO and conclude public service obligation agreements with the seven largest power entities. Legislative work is also expected: amendments to the Companies Act, 2017 must be tabled in Parliament to strengthen compliance requirements for unlisted firms and modernise corporate governance. Separately, the government must issue a concept note outlining the aims, expected outcomes, reasons for change and KPIs for proposed amendments to the SEZ Act, according to The Tribune.

The IMF report also records Pakistan’s commitment to introduce a mini-budget if revenues fall short by the end of December 2025. If triggered, the measures would include increasing federal excise duty on fertilisers and pesticides by 5%, levying excise duty on high-value sugary products and widening the sales tax net by moving selected goods to the standard rate.

Additionally, the IMF has extended Pakistan’s deadline to publish the action plan addressing the weaknesses flagged in the Governance and Corruption Diagnostic reports.

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