The International Monetary Fund (IMF) has significantly expanded its bailout program requirements for Pakistan, adding 11 new conditions and bringing the total to 50 structural benchmarks and conditions.According to the Express Tribune, among the key new requirements, Pakistan must secure parliamentary approval for a Rs 17.6 trillion budget, implement higher debt servicing surcharges on electricity bills, and remove restrictions on the import of used cars older than three years.The IMF has also expressed concern about the potential impact of rising India-Pakistan tensions on the program’s success.The IMF’s staff-level report, released on Saturday, cautioned, “Rising tensions between India and Pakistan, if sustained or deteriorate further, could heighten risks to the fiscal, external and reform goals of the programme.”
Here are IMF’s 11 new conditions for Pakistan
- Parliamentary approval of Rs 17.6 trillion federal budget
- Pakistan must pass a new budget for fiscal year 2025–26 in line with IMF programme targets by June 2025.
Agricultural Income Tax reform at provincial level- All four provinces must implement new laws by June including:
- Taxpayer identification and registration
- Compliance improvement plan
- Communication campaigns
- Operational return-processing platform
- All four provinces must implement new laws by June including:
- Governance action plan
- Government must publish a governance reform strategy based on the IMF’s Governance Diagnostic Assessment.
- Post-2027 financial sector strategy
- A long-term plan must be prepared and published outlining institutional and regulatory objectives for the financial sector post-2027.
- Annual electricity tariff rebasing notification
- Must be issued by July to maintain tariffs at cost-recovery levels.
- Semi-annual Gas Tariff Adjustment Notification
- Required by February, 2026, to ensure cost recovery in gas pricing.
- Captive power levy ordinance legislation
- Parliament must make this ordinance permanent by the end of May.
- Aimed at shifting industrial energy use to the national grid.
- Remove cap on debt servicing surcharge
- Legislation must be adopted to eliminate the Rs 3.21 per unit ceiling on this surcharge by June.
- Phase-out plan for special technology zones incentives
- Pakistan must prepare a plan by end-2024 to eliminate all fiscal incentives for STZs and other industrial parks/zones by 2035.
- Used car import liberalisation
- Submit legislation to Parliament by end-July to lift quantitative restrictions on the commercial import of used cars (initially up to five years old).
- Development spending commmitment
- Out of the Rs 17.6 trillion budget, Rs 1.07 trillion must be allocated for development spending.
