In order to finalize key components of the impending bailout package under the $6–$8 billion Extended Fund Facility (EFF) program, an IMF delegation is anticipated to visit Pakistan in mid-May 2024.

ISLAMABAD: To finalize the key components of the impending bailout package under the $6–$8 billion Extended Fund Facility (EFF) program, an IMF mission is expected to visit Pakistan in mid-May 2024.

For around two weeks, the IMF team will remain in Islamabad to finalize the macroeconomic and fiscal framework for the upcoming three- to four-year program. Around June 6 or 7, 2024, the government is anticipated to offer the upcoming budget, 2024–25, to the parliament, with the option to enact strict measures intended to achieve fiscal stabilization.

Starting in the upcoming fiscal year, pension reforms may emerge as a primary requirement of the IMF program, making pension provision unfeasible. A different plan to include pensions in taxes is being considered.

The FBR is thinking of including a Rs. 100,000 monthly pension into the tax system. Another option is to impose a flat rate of 10 percent on pensioners' taxable ceiling amounts.

During the next negotiations between the two sides, the scale of the next EFF program will be decided.

As Bangladesh is doing to increase the size of the IMF program, Pakistan is also anticipated to ask the IMF for augmentation through climate funding. Additionally, the program amount for Egypt was expanded to $8 billion.

The IMF is prepared to suggest significant taxes and spending reductions in order to accomplish fiscal consolidation at the next round. The primary surplus has stayed positive, but the overall fiscal balance has been deteriorating as a result of net revenue receipts falling short of debt servicing obligations, which turned out to be the biggest expense item.