Pakistan and the International Monetary Fund have reached a staff-level agreement on two programme reviews that could unlock approximately $1.21 billion after approval by the lender’s Executive Board.
The agreement covers the fourth review of the $7 billion Extended Fund Facility and the third review of the Resilience and Sustainability Facility.
The prospective amounts are about $1 billion under the EFF and $210 million under the RSF. The agreement does not mean the money has already been disbursed.
What the IMF assessed
An IMF mission led by Iva Petrova held discussions in Karachi and Islamabad from September 23 to October 7.
The team also completed discussions for Pakistan’s 2026 Article IV consultation, which examines the country’s economic performance and policies.
The Fund said Pakistan had maintained a degree of macroeconomic stability despite disruption from the Middle East conflict.
It estimated growth of 3.6% in fiscal year 2025–26 and noted that foreign-exchange reserves had reached approximately $21.5 billion by the end of September.
However, the IMF also highlighted risks from volatile energy prices, geopolitical tensions and tighter international financing conditions.
Reforms remain central
The programme continues to emphasise tax collection, fiscal discipline and measures to contain energy-sector losses.
The IMF identified risk-based tax audits, digital invoicing and better use of third-party data as priorities for revenue administration.
It also called for targeted support for vulnerable households rather than broad fuel subsidies that could place additional pressure on the budget.
Energy reforms include improving distribution performance, reducing gas losses and containing circular debt.
The RSF focuses on longer-term climate resilience, including disaster financing, public investment planning and energy efficiency.
Next step: Board approval
The staff-level agreement is an important negotiating milestone, but the Executive Board must approve the reviews before the associated financing can be released.
Pakistan’s progress will continue to be assessed through future programme reviews.
The immediate outcome is therefore an agreement on the review, not a completed disbursement or the end of the reform programme.