Finance Minister, SBP Governor signs IMF conditions

Islamabad: With the approval of 22 conditions under the $7 billion Extended Fund Facility (EFF), Pakistan has entered into written agreements with the International Monetary Fund (IMF), signed by the Finance Minister and the Governor State Bank of Pakistan (SBP).

Under these agreements, Pakistan has undertaken to develop a plan to phase out Special Economic Zones (SEZs) by June 2025, with all SEZs to be phased out by 2035.

The government will prepare a plan by June 2025 and implement an estimate to phase out all existing concessions of SEZs by 2035.

The government accepted the IMF condition that it approve changes in gas tariffs by December 2024 and impose a 5 percent Federal Excise Duty (FED) on fertilisers and pesticides in the 2025-26 budget.

To make the anti-corruption framework effective, the government will amend the Civil Service Act by 2025 to ensure digital filing and public access to assets of high-level public officials (with protection of personal information), and a stable framework for the assessment of assets will be developed by FBR.

The government will strive to achieve net zero revolving credit flows by FY 2025 through a combination of timely tariff hikes, targeted subsidies, and cost-cutting reforms in the power sector.

The report released by the IMF said that Pakistan's debt servicing capacity faces significant risks and depends on the effective implementation of policies and timely external financial support.