Islamabad, 26 May , 2025: Budget 2025-26 negotiations between the government and the International Monetary Fund (IMF) remain at a stalemate, with key differences emerging over fiscal targets and development expenditure.
As pressure mounts to reach a consensus, concerns grow over delays in shaping the next economic framework.
IMF Raises Concerns Over Federal Development Allocations
Budget 2025-26 talks have hit a critical snag, as IMF officials have reportedly objected to several proposed components of the upcoming federal budget.
According to sources, the international lender has taken issue with the size and scope of the Public Sector Development Program (PSDP), citing concerns about fiscal sustainability.
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Insiders from the Planning Commission revealed that the financial burden from ongoing development projects referred to as the “throw-forward” has now surpassed Rs 10 trillion, further complicating future investment planning.
Prime Minister Demands Details on Key Projects
Budget 2025-26 deliberations intensified after the Prime Minister requested comprehensive updates on 500 major development projects.
Sources confirmed that the Ministry of Planning was instructed to provide a breakdown of these initiatives, most of which are said to involve infrastructure-related work.
The administration is reportedly struggling to finalize a clear roadmap for development spending, as differences persist between the Ministry of Finance and the Ministry of Planning over budgetary targets and priorities.
High-Level Planning Meeting Postponed
The Annual Planning Coordination Committee, which was scheduled to convene today to draft the federal development strategy, has been postponed. A new date for the session will be announced soon, sources from the Planning Commission confirmed.
READ MORE: IMF Rejects Key Budget Targets: What’s Next?
The meeting was expected to formulate key recommendations for the federal development budget and outline the broader economic agenda for the fiscal year 2025-26.
Officials had also planned to assess progress on the current year’s development goals during the session.
Until a unified development blueprint is established, uncertainty around Budget 2025 is likely to persist, posing challenges for economic planning and international financial cooperation.
