The second round of economic review talks between Pakistan and the International Monetary Fund (IMF) is underway as the government seeks the next $1.2 billion tranche.

While officials in Islamabad describe the discussions as “positive and constructive,” the IMF mission has flagged concerns over unfulfilled reform commitments and targets, and legislative delays.

IMF flags missed reform targets

According to official documents, Pakistan was required to amend laws in at least 10 government institutions by June this year under the Memorandum of Economic and Financial Policies. However, the deadline was missed, and the IMF has asked for an explanation.

The pending reforms include critical legislation for the Ministry of IT, Commerce, Maritime Affairs, Railways, and Water Resources. Specific laws left incomplete are:

Port Qasim Authority Act and Gwadar Port Ordinance
Karachi Port Trust Act 1980 (amendment not completed)
Pakistan Telecom Reorganization Act (draft not shared)
State Life Insurance Nationalization Order (still under review)
WAPDA Act (changes postponed)
Pakistan Railways Act 1890 (consultations ongoing)
Exim Bank Act (draft prepared but pending approval)
National Bank Act (amendment tied to Sovereign Wealth Fund Act)

IMF pushes for stronger export financing

Beyond legal reforms, the IMF also emphasized strengthening trade and export financing schemes to boost Pakistan’s foreign trade performance. The mission highlighted the importance of improving credit flows and supporting priority sectors.

Also Read: FinMin rules out additional tax measures amid positive IMF talks

Officials briefed the IMF about ongoing measures, including plans for the early operationalization of Exim Bank to support exporters.

Govt calls talks 'constructive'

Despite IMF concerns, the Ministry of Finance has termed the discussions constructive and expressed confidence in progress. Officials maintain that Pakistan remains committed to implementing reforms and addressing gaps identified by the IMF.

What’s next?

The outcome of these talks will determine the release of the next $1.2 billion tranche from the IMF. For Pakistan, fulfilling reform requirements and strengthening export financing are seen as crucial steps to stabilize the economy and boost investor confidence.

On Wednesday, Finance Minister Muhammad Aurangzeb made it clear that no additional tax measures were under consideration at present.

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Speaking to the media in Islamabad, Aurangzeb expressed determination to achieve the target of raising the tax-to-GDP ratio to 11%. He made it clear that no additional tax measures are under consideration at present. He mentioned that several tax cases are pending in the courts and that progress in these cases is expected to improve tax collection.