The International Monetary Fund (IMF) has reportedly asked Pakistan to further downsize the workforce of the Utility Stores Corporation by June 30, 2025, as part of the third phase of the government’s right-sizing policy.
According to sources, around 2,237 daily wage workers have already been terminated in the initial phase. In the ongoing second phase, approximately 2,800 contract employees from grade 1 to 13 are being laid off. Employees in grade 14 and above are expected to be moved into a surplus pool by the same deadline.
In addition to workforce reductions, the government plans to close around 1,000 financially underperforming utility stores by the end of the current fiscal year. This will reduce the total number of operational stores from 5,500 to just 1,500. Daily wage staff working at the closing outlets will also be let go, and the remaining utility stores are set to be privatized, according to official documentation.
Despite receiving a Rs38 billion subsidy last year, Utility Stores Corporation has yet to receive any disbursement from the Rs60 billion allocated for the current fiscal year.
This development comes ahead of a crucial IMF Executive Board meeting scheduled for May 9, where Pakistan’s economic performance will be reviewed. The Board is expected to approve a $1.1 billion disbursement as part of the ongoing Extended Fund Facility (EFF).
Additionally, Pakistan has secured $1.3 billion in climate financing through the IMF’s Resilience and Sustainability Facility (RSF), as confirmed by IMF Communications Director Julie Kozac. Last month, Islamabad and the IMF reached a staff-level agreement for both the EFF review and the new RSF arrangement.
