ISLAMABAD: The International Monetary Fund (IMF) has further tightened its grip on Pakistan’s economic policymaking, attaching 11 new conditions to the ongoing $7 billion bailout package. With this, the tally of IMF-imposed requirements has surged to 75 in under two years, covering everything from budget approval to energy tariffs, tax audits, and regulatory reforms.
Media reports suggest that among the latest demands, the IMF has insisted that parliament pass the upcoming FY2026-27 budget strictly in line with staff-level agreements, marking the second consecutive year that fiscal planning is dictated by the lender.
It has also directed amendments to laws governing Special Economic Zones and Special Technology Zones by June 2027, phasing out fiscal incentives and curbing authorities’ powers to grant tax breaks. Export Processing Zones face new restrictions, with a ban on selling goods in the domestic market by September 2026, aimed at curbing tax evasion.
Energy pricing has been placed under tighter control, with automatic monthly fuel charge adjustments, quarterly electricity tariff hikes, and semi-annual gas price revisions mandated. By January 2027, full annual electricity price implementation must be in place.
The IMF has also required the establishment of a Pakistan Regulatory Registry by June 2027 to centralise business regulations, alongside reforms in the Federal Board of Revenue’s audit system, including centralised case selection and mandatory follow-up of high-risk cases. Procurement rules are to be amended by September 2026 to eliminate state-owned enterprise preferences in contracts.
While these measures tighten fiscal discipline, the IMF has also called for an increase in Benazir Income Support Programme stipends from Rs14,500 to Rs19,500 starting January 2027, ostensibly to offset the inflationary impact of higher energy costs and reduced industrial incentives.
Experts believe the IMF’s ever-expanding “do more” demands highlight the erosion of Pakistan’s policy autonomy, with parliament, regulators, and ministries increasingly bound by external dictates. While the measures aim to stabilise fiscal accounts and enforce transparency, they also risk squeezing growth, raising energy costs for consumers, and unsettling investors. The balancing act between IMF compliance and domestic economic needs is becoming sharper as the bailout programme deepens.
