The IMF has broadened its conditions for Pakistan ahead of the next $1.2 billion tranche, with the country agreeing to a new set of reforms covering procurement rules, tariff adjustments, tax administration, and social spending.
The International Monetary Fund has set 11 new conditions for the next disbursement. These include ending preferential treatment for state-owned enterprises in procurement, revising gas and power tariffs, and phasing out fiscal incentives for Special Economic Zones and Special Technology Zones.
One new structural benchmark requires Pakistan to amend its procurement rules so that state-owned enterprises no longer receive preferential treatment in major public contracts.
The government has agreed to implement semi-annual gas tariff adjustments from July 2026 and annual power tariff adjustments from January 2027. As a result, both electricity and gas prices may change during fiscal year 2026–27.
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Pakistan has also accepted an IMF condition requiring it to amend the legal frameworks for SEZs and STZs and phase out fiscal incentives in line with the Finance Bill 2026.
The report adds that Pakistan will abolish all fiscal incentives granted to SEZs under CPEC by 2035. It also says the government will seek parliamentary approval for the 2026–27 budget in line with IMF staff understandings, while an IMF mission is expected to visit Islamabad next month to finalise the fiscal framework.
The government has also agreed to amend the NAB Ordinance by January 2027 to introduce qualification criteria and a merit-based competitive selection process.
To address tax shortfalls, the Federal Board of Revenue will issue regulations that govern the selection of audit cases through a centralised mechanism. This step comes as the FBR faces a major revenue gap while trying to meet the revised annual target of Rs13.97 trillion by June 30, 2026.
The government will establish a Pakistan Regulatory Registry to streamline business regulation for the federal government and the Islamabad Capital Territory.
Pakistan has also agreed to raise the BISP stipend from Rs14,500 to Rs19,500 from January 2027, a move that will require a larger allocation for the programme in the next federal budget.
The report further states that the State Bank of Pakistan will develop a roadmap for the gradual liberalisation of the foreign exchange regime by the first quarter of 2027. This signals a broader push to ease restrictions in line with IMF expectations.
