Pakistan, IMF begin review talks on $7 bn loan programme

An IMF mission held a formal kick-off meeting with Pakistan’s economic team to review the $7 billion Extended Financing Facility and $1.1 billion Resilience and Sustainability Facility. Revenue collection shortfalls and stalled refinery investments are among key discussion points.

Islamabad: An IMF mission held a formal kick-off meeting with Pakistan’s economic team to review the implementation of a USD 7 billion loan and a USD 1.1 billion Resilience and Sustainability Facility, according to a media report on Tuesday.

It comes as the programme’s performance as of end-June 2025 — the period under review — has been mixed, the Dawn newspaper reported.

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The IMF team led by Pakistan’s Mission Chief Iva Petrova met on Monday with Pakistan’s delegation headed by Finance Minister Muhammad Aurangzeb.

The opening session was attended by key economic stakeholders, including the State Bank of Pakistan governor, the finance secretary and the Federal Board of Revenue (FBR) chairman.

The mission will remain in Pakistan for almost two weeks and review the implementation of the USD 7 billion Extended Financing Facility (EFF) and the USD 1.1 billion Resilience and Sustainability Facility (RSF).

According to the report, the programme’s performance has been mixed as of end-June 2025, and the start of the next review period, ending in December this year, has also been off the mark, particularly in revenue collection.

The two sides now have to agree on corrective measures during their dialogue to meet the next biannual targets.

While power sector benchmarks for the end-June 2025 period were comfortably met, revenue collection fell short by about Rs 1.2 trillion — almost 1 per cent of GDP — in the last fiscal year, and the first two months of the current fiscal year have shown similar shortfalls.

While in Pakistan, the mission will also hold forward-looking discussions with the authorities to push for faster implementation of the end-December 2025 targets, the report said.

Pakistan is also raising with the IMF a long-delayed implementation of the brownfield petroleum refinery policy, which has stalled about USD 6 billion in fresh investment for refinery upgrades.

Officials argue that this demand aligns with the RSF’s objectives because the upgrade would help produce petroleum products meeting European standards with minimal carbon and sulphur emissions, according to the report.