Islamabad, Mar 21, 2025: Pakistan is on track to secure a staff-level agreement with the International Monetary Fund (IMF) by the end of April, as the lender has acknowledged significant progress in key economic reforms, according to sources from the Finance Division.
Additionally, the IMF is expected to approve $1.2 billion in climate financing, with disbursement likely to take place through the Executive Board alongside the next loan tranche next month.
Insiders revealed that Pakistan’s current economic indicators align well with IMF expectations, demonstrating notable improvements in February and March.
Analysts anticipate that the Pakistani Rupee will maintain stability within the range of 277-279 against the US dollar in the coming days, reflecting positive market sentiment.
The government does not expect to introduce drastic changes in taxation in the upcoming federal budget, as existing tax policies remain largely on track despite opposition from key sectors such as real estate, development, and retail.
Provincial authorities will address taxation concerns related to specific sub-sectors.
Meanwhile, the IMF has revised the Federal Board of Revenue’s (FBR) annual tax collection target downward, adjusting it from Rs. 12.97 trillion to Rs. 12.33 trillion for the current fiscal year.
The IMF has also raised concerns about the enforcement of certain tax policies but believes that exceeding revenue collection targets is unnecessary at this stage.
A key concern remains the issue of non-filers, with stricter legal action anticipated in the upcoming fiscal year.
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Authorities will introduce additional measures to ensure tax compliance.
Despite these challenges, foreign investors are steadily investing in the stock market, and the government is taking steps to lower interest costs on loans.
Furthermore, the Finance Division aims to enhance the country’s tax-to-GDP ratio to a minimum of 15 percent, with full-fledged efforts beginning in July 2025.
In a separate development, the government will implement a new contributory pension system for the armed forces starting July 1, 2025.
The Finance Division remains optimistic about the ongoing negotiations with the IMF and expects to finalize a staff-level agreement by the end of April.
These developments indicate a stable economic outlook and continued efforts toward fiscal discipline and sustainable growth.
