Pakistan is under mounting pressure after the International Monetary Fund imposed 11 new conditions on its already stringent $7 billion bailout programme. These additions raise the total number of reforms Pakistan must complete to 64 within the next 18 months. The IMF cleared a $1.2 billion tranche only days earlier, but made clear that further disbursements will depend on Islamabad’s willingness to tackle corruption, strengthen institutions and repair structural weaknesses in its economy.
The first major requirement demands that Pakistan begin declaring the assets of senior federal civil servants by the end of this year, with the same rule to be extended later to provincial officials. This marks a significant push for transparency in a bureaucracy long criticised for opaque financial practices. The IMF has also asked Pakistan to devise action plans for addressing corruption across 10 high-risk government departments and to strengthen provincial anti-corruption bodies, including by giving them access to financial intelligence databases.
In addition, Pakistan must complete a comprehensive review of remittance costs and cross-border payment obstacles. It has been directed to prepare a strategy to reform its local-currency bond market, a step the IMF believes is essential for financial deepening. Another politically sensitive condition requires Islamabad to introduce a national sugar market liberalisation policy, aiming to break the grip of entrenched cartels closely linked to powerful political families.
Tax reforms again feature prominently. Pakistan has been told to submit a detailed reform roadmap for its revenue board and produce a medium-term tax strategy to address chronic under-collection. In the power sector, the IMF wants losses reduced and all prerequisites met to allow private-sector involvement in electricity distribution companies. Corporate sector reforms are also mandated, including amendments to the Companies Act and revisions to the Special Economic Zones Act.
Finally, the IMF has warned that if Pakistan fails to meet upcoming revenue targets, it must present a mini-budget next year. This signals potential tax hikes or expenditure cuts at a time when the public is already struggling with high inflation and declining purchasing power. The expanded list of conditions underscores the depth of the country’s economic crisis and the scale of reform the IMF now expects before releasing future bailout funds.
