IMF Puts 11 Strict Conditions On Pakistan To Extend Loan: Can Islamabad Meet The Challenge?

(MENAFN- Live Mint) The International Monetary Fund (IMF) has imposed 11 strict new conditions for Pakistan to access its loans, aimed at tackling corruption risks, curbing elite control of the sugar sector, and revealing the real costs tied to foreign remittances.

Out of the 11 conditions, three are related to tax reforms, asset declarations of government officials, and private-sector participation in the energy sector - all of which Pakistan must fulfil by the end of December.

These conditions also seek to reduce losses in the power sector by bringing private sector participation, improving governance and service delivery, and boosting the effectiveness of the“highly inefficient” Federal Board of Revenue (FBR), Tribune said in a report.

The IMF on Thursday released its staff-level report for the second review of the $7 billion bailout package, outlining the new conditions. With the fresh additions, the total number of requirements has risen to 64 in just a year and a half.

What are the conditions?

Here are the conditions mentioned in the report, along with the timelines by which these must be met:

- End March 2026: Pakistan must finalise a detailed tax-reform roadmap by December 2025, outlining key priorities, staffing needs and roles, timelines and milestones, revenue impact estimates, and key performance indicators (KPis) to track progress and outcomes.

Using the roadmap, the country must complete all actions to fully implement at least three priority reforms agreed upon with the IMF, including any required subordinate legislation, staff hiring and allocation, and initial KPI reporting by the end of March 2026.

- End May 2026: It must complete a full assessment of remittance costs and structural impediments to cross-border payments, along with an action plan to improve such payments.

- End June 2026: The government must sign public service obligations (PSO) agreements with each of the 7 largest PSOs before submission to Parliament of the FY27 budget.

- End June 2026: Federal and provincial governments must agree and the federal cabinet must adopt a national policy for sugar market liberalization containing key recommendations on licensing, price controls, import/export permissions, and zoning, and clear timelines for implementation.

- End June 2026: Legislative amendments to the Companies Act, 2017 must be submitted to Parliament within the deadline to strengthen compliance for unlisted firms, modernise corporate governance structures, and align corporate regulations with international best practices.

- End June 2026: Within that time, Pakistan must publish a concept note outlining the scope, objectives, and expected outcomes of reforms to the SEZ Act.

- End September 2026: The country shall also conduct a study on the bottlenecks in the local currency bond market and publish a reform plan to address areas of improvement.

- End October 2026: Pakistan must publish an action plan to address corruption vulnerabilities in identified departments.

- End December 2026: It must publish a 3-5 year medium-term tax reform strategy, covering a roadmap of tax policy, administration, and legal reforms. It should also cover clear governance arrangements and a resource plan for implementation.

- End December 2026: T he government must publish asset declarations of high-level federal civil servants.

- End December 2026: Pakistan must finalise preconditions for the private sector participation processes for HESCO and SEPCO.

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