IMF: The International Monetary Fund (IMF) imposed eleven additional requirements on Pakistan to release the next tranche of its bailout program. Moreover, the IMF cautioned that ongoing tensions with India may increase risks to the scheme’s external, reform, and fiscal objectives.
Among the key conditions, parliament must approve a new budget of Rs 17.6 trillion. In addition, the government must raise the debt servicing tax on power bills. Furthermore, Pakistan must lift the import ban on used cars older than three years, along with meeting several other newly imposed requirements.
1. Parliamentary approval of the FY 2026 federal budget amounting to Rs 17.6 trillion, in line with IMF targets, by end-June 2025.
2. The implementation of new Agriculture Income Tax laws by all four provinces includes establishing an operational platform, carrying out taxpayer registration, launching a communication campaign, and developing a compliance improvement plan, all to be completed by the June 2025 deadline.
3. Publication of a governance action plan based on the IMF’s Governance Diagnostic Assessment to address critical governance vulnerabilities.
4. Preparation and publication of a post-2027 financial sector strategy, and outlining institutional and regulatory frameworks for the period from 2028 onward.
5. Notification of annual electricity tariff rebasing by July 1, 2025, to ensure tariffs reflect cost recovery levels.
6. Notification of semi-annual gas tariff adjustments by February 15, 2026, to maintain cost recovery in the energy sector.
7. Legislation to make the captive power levy ordinance permanent by the end of May 2025, encouraging industries to shift to the national electricity grid.
8. Legislation to remove the Rs 3.21 per unit cap on the debt service surcharge by the end of June 2025, enabling higher surcharges to cover inefficiencies.
9. The preparation of a plan to phase out all incentives related to Special Technology Zones and industrial parks by 2035 is required, with the report scheduled to be submitted by the end of 2025.
10. The lifting of restrictions on the import of used vehicles will initially allow the import of vehicles up to five years old by the end of July 2025, increasing the current limit from three years.
11. An increase in the debt servicing surcharge on electricity bills is planned in order to improve financial sustainability in the power sector.
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