Islamabad, December 14, 2025: The Ministry of Finance on Sunday rejected reports suggesting that Pakistan has accepted “new” or abrupt conditions under its ongoing programme with the International Monetary Fund (IMF), clarifying that the 11 targets cited in recent media reports reflect the continuity and sequencing of reforms already agreed under the $7 billion Extended Fund Facility (EFF).
In a statement, the ministry said the measures were part of a phased, medium-term reform agenda aimed at deepening previously agreed commitments, rather than the imposition of unprecedented or externally dictated conditions.
The clarification came after reports that the government had agreed to 11 additional targets — including further tax measures and expenditure controls from early next month — to offset revenue shortfalls and keep the IMF programme on track. The measures were outlined in IMF documents released earlier this week.
According to the IMF, commitments to new or revised structural benchmarks, along with the completion of two prior actions, paved the way for a staff-level agreement on the second review of the EFF. The agreement was subsequently approved by the IMF Executive Board, enabling the disbursement of about $1.2 billion to Pakistan on December 9.
The finance ministry said the IMF’s EFF was designed to support countries in implementing structural reforms over the medium term in a step-by-step manner. “Each review builds upon prior actions to ensure that agreed policy objectives are achieved over the life of the programme,” the statement said.
It added that the Memorandum of Economic and Financial Policies (MEFP) finalised after the second review supplemented the MEFP agreed during the first review and reflected this phased approach. During negotiations, the government presented its own reform initiatives, many of which were incorporated into the MEFP after being assessed as consistent with programme objectives.
Addressing specific measures described as “new conditions,” the ministry said the public disclosure of asset declarations of civil servants had been part of the EFF since the initial MEFP in May 2024. The current benchmark, it said, represented the second step following amendments to the Civil Servants Act, 1973.
Commitments to strengthening the operational effectiveness and independence of the National Accountability Bureau (NAB), including coordination with provincial anti-corruption bodies, were also agreed in earlier reviews. Similarly, granting provincial anti-corruption establishments access to financial intelligence was described as aligned with Pakistan’s ongoing Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) reforms.
On remittances, the ministry said strengthening inflows was critical for external stability, noting a 26 per cent year-on-year increase from FY24 to FY25 after steps to curb informal channels. Further growth of 9.3 per cent is projected for FY26. Measures to remove bottlenecks in cross-border payments, undertaken with the State Bank of Pakistan, were later incorporated into the MEFP.
The ministry said a recommendation made in an IMF staff report published in May 2025 to study bottlenecks in the local currency bond market had now been formalised as a structural benchmark. It also said the push to deregulate the sugar industry originated from the government, with a task force mandated to recommend full market liberalisation in consultation with the provinces.
Similarly, the development of a comprehensive roadmap for the Federal Board of Revenue (FBR) was described as part of a domestic resource mobilisation agenda led by the prime minister. The requirement to publish a medium-term tax reform strategy was termed a logical extension of earlier reforms, including the establishment of the Tax Policy Office.
On the power sector, the ministry reiterated that the privatisation of electricity distribution companies (Discos) had been a core element of the EFF since its inception and was planned to be implemented in phases. Finalising preconditions for private-sector participation in Hyderabad Electric Supply Company (Hesco) and Sukkur Electric Power Company (Sepco) was described as the next step in the process.
The statement also said amendments to the Companies Act, 2017 to strengthen compliance for unlisted firms and proposed changes to the Special Economic Zones (SEZ) Act were part of a broader regulatory reform agenda embedded in the programme from the outset.
Finally, the ministry noted that contingency measures to address potential revenue shortfalls had been included in the MEFP framework since May 2024.
“In conclusion, the measures outlined in the latest MEFP represent continuity, sequencing and deepening of Pakistan’s agreed reform agenda under the IMF’s Extended Fund Facility, rather than the imposition of abrupt or unprecedented conditions,” the ministry said.
