Islamabad – A mission from the International Monetary Fund (IMF), led by Iva Petrova, is scheduled to arrive in Pakistan on February 26th to begin a review of the country’s economic performance under a $7 billion Extended Fund Facility (EFF) and a $1.1 billion Resilience and Sustainability Facility (RSF). The nearly two-week assessment, concluding March 11th, will be critical in determining the release of approximately $1 billion in further funding.
The IMF team will assess Pakistan’s progress as of the end of December 2025, focusing on implementation of the existing program and discussing preliminary budget proposals for the fiscal year 2026-27, with particular attention to provincial finances, according to officials familiar with the planned discussions.
While overall program performance has largely remained on track, revenue collection has fallen short of expectations. Still, authorities are optimistic that a recent ruling by the Federal Constitutional Court in favor of the government regarding a super tax will partially offset this shortfall. The IMF team will similarly scrutinize recent policy shifts in the power sector, including adjustments to industrial tariffs and residential fixed charges, though circular debt levels are currently within agreed-upon targets.
Pakistan has reportedly met most quantitative performance criteria for the end of December 2025, but lags in certain indicative targets and structural benchmarks. These shortcomings could potentially impact future implementation plans, necessitating agreement on corrective measures during the current review period.
Topline Research anticipates Pakistan will meet nearly all seven quantitative performance criteria, though data for one indicator – a floor on targeted cash transfers – remains unavailable. The firm noted a previous technical slippage in this area was due to lower administrative expenses rather than reduced beneficiary numbers. Topline also projects net international reserves will fall slightly below benchmarks, reaching approximately $6.7 billion against a $7 billion target for September 2025 and below $6 billion against a $6.5 billion target for December 2025.
The State Bank of Pakistan’s net domestic assets (NDA) are also projected to remain below ceiling targets, while foreign currency swaps are expected to align with agreed-upon limits. Primary surplus figures are estimated at Rs3.5 trillion and Rs4.1 trillion for September and December, respectively, exceeding targets. Topline Research also indicated the government is likely to meet targets for recent tax returns and government guarantees.
The Federal Board of Revenue’s (FBR) indicative criteria were missed by Rs336 billion, but officials hope the super tax verdict will mitigate this gap, even if the annual revenue goal remains unmet. The IMF mission, which began discussions on Monday, is led by Iva Petrova, the fund’s mission chief for Pakistan, and includes meetings with Finance Minister Muhammad Aurangzeb and other senior economic officials.
Discussions are centered on Pakistan’s economic performance, revenue collection, spending discipline, and progress on structural reforms, including the National Fiscal Pact, capital market reforms, and transparency in development spending. The IMF team has also requested updates on the Governance and Corruption Risk Assessment Report, anti-money laundering enforcement, and transparency measures.
An IMF statement following a previous review, concluding October 8, 2025, indicated “significant progress” toward a staff-level agreement on the second review of the EFF and the first review of the RSF. The statement highlighted the importance of sustaining fiscal consolidation, maintaining a tight monetary policy to control inflation, restoring the viability of the energy sector, and advancing structural reforms to reduce state intervention and improve the business environment.
