Pakistan’s government has underscored its unwavering commitment to maintaining fiscal discipline and advancing difficult structural reforms, particularly in taxation and energy, as it commenced crucial discussions with an International Monetary Fund (IMF) mission for the third review of its Extended Fund Facility (EFF) arrangement.
Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, conveyed the government’s firm resolve during a kick-off meeting with the IMF delegation, led by Ms Iva Petrova today. The talks also cover the second review of the Resilience and Sustainability Facility (RSF).
The minister stressed that structural reforms remain central to the government’s agenda, highlighting that a comprehensive transformation of tax administration is underway. He noted these efforts, encompassing improvements in personnel, processes, and technology, are being driven by strong leadership at the highest level.
Further details were shared on the establishment of a fully operational Tax Policy Office, designed to ensure future fiscal policy is guided by economic principles that foster sustainable growth.
On the privatisation front, the minister reaffirmed the administration”s pledge to advance key transactions and restructuring initiatives for state-owned enterprises this year. He observed that growing investor confidence and a renewed appetite among domestic financiers reflect trust in the economy”s direction and reform trajectory, adding that the process would be conducted in a transparent and orderly manner.
As part of broader public sector reforms aimed at improving efficiency, the minister outlined progress on right-sizing the federal government, which includes the merger of ministries and the closure of certain entities. He reiterated the government”s dedication to an export-led growth strategy, supported by trade facilitation and tariff rationalisation.
Mr. Aurangzeb also apprised the mission of the country’s response to recent flood-related challenges, noting that fiscal buffers had enabled timely rescue and relief efforts, strengthening resilience to external and climate-related shocks.
While recent economic indicators point towards a gradual recovery, the minister acknowledged emerging global headwinds, including geopolitical developments and volatile international energy markets, as potential risks. He informed the IMF delegation that a high-level committee has been formed to monitor the situation and ensure coordinated policy responses.
The Finance Minister emphasised that while stabilisation measures were essential, the government remains mindful of the social impact and would continue to pursue policies aimed at enhancing social spending to protect the nation”s vulnerable population.
Ms. Petrova acknowledged the comprehensive briefing and confirmed that both sides would continue their discussions virtually in the coming days.
The dialogue was also attended by Governor State Bank of Pakistan Mr Jameel Ahmad, the Secretary of Finance, the Chairman of the Federal Board of Revenue (FBR), and other senior officials from the Finance Division.