IMF Imposes 11 New Conditionalities on Pakistan for Bailout ProgrammeIslamabad

Pakistan, May 18 – The International Monetary Fund (IMF) has introduced 11 additional conditions for Pakistan as part of its ongoing bailout programme, Pakistan-based Express Tribune reported. The measures aim to ensure fiscal stability and economic reforms amid rising tensions between India and Pakistan.
According to an IMF Staff Level report released on Saturday, continued geopolitical strains could pose risks to Pakistan’s fiscal, external, and reform objectives. The new conditionalities include the approval of a Rs 17.6 trillion budget for 2025-26 in accordance with IMF targets.
On the fiscal front, Pakistan must implement the Agriculture Income Tax laws, establishing a framework for tax processing, registration, and compliance. The deadline for this reform is set for June this year. Additionally, the government must publish a governance action plan to address vulnerabilities based on an IMF diagnostic assessment.
Among the energy-sector mandates, the IMF has introduced four new conditions to improve efficiency and sustainability. The government is also required to prepare a post-2027 financial sector strategy, detailing institutional and regulatory frameworks for future economic planning.
Trade and investment policies are subject to further adjustments, with Pakistan obligated to draft a plan for phasing out incentives tied to Special Technology Zones and industrial parks by 2035. Another key condition mandates lifting restrictions on commercial imports of used motor vehicles, initially applying to cars less than five years old, by the end of July. This move aims to liberalize trade and enhance vehicle affordability.
The IMF reviewed Pakistan’s Extended Fund Facility (EFF) programme—worth USD 1 billion—on May 9, alongside discussions on a Resilience and Sustainability Facility (RSF), which could inject an additional USD 1.3 billion. The latest review brings total disbursements to USD 2 billion within the larger USD 7 billion bailout package.
Economic analysts note that while the IMF’s conditions could pave the way for financial stability, they also present challenges in terms of implementation and political feasibility. The coming months will be crucial as Pakistan navigates these reforms while addressing broader economic concerns.