Pakistan’s $7 billion IMF programme has been expanded with nearly 11 additional conditions, lifting the total number of structural and policy benchmarks to 75, government sources said, as the latest staff-level agreement was finalised. The new set of requirements spans fiscal governance, energy pricing, investment policy, taxation, and social protection, reinforcing the Fund’s oversight across core areas of economic management. A key fiscal commitment requires the government to ensure that the 2026–27 federal budget is approved by the National Assembly in line with IMF programme parameters, marking the second consecutive budget to be legislatively aligned with Fund targets.

Finance Minister Muhammad Aurangzeb also assured the IMF that Pakistan will maintain a fiscally consolidated budget framework and will not pursue higher-than-programme economic growth targets in the upcoming fiscal year, according to official sources. On structural reforms, Pakistan has agreed to a sweeping overhaul of its Special Economic Zones (SEZs) and Special Technology Zones Authority (STZA) frameworks. By June 2027, laws will be amended to phase out existing fiscal incentives, shift from profit-based to cost-based structures, and withdraw incentive-granting authority from existing approval bodies.

A full phase-out of current fiscal incentives for technology zones has been set for 2035, while new SEZ-related policy changes are intended to create a uniform investment regime under IMF guidance. In a parallel trade restriction measure, Export Processing Zones will be prohibited from selling goods in the domestic market starting September this year, addressing concerns over tax leakage and regulatory arbitrage. By June next year, Pakistan will establish the Pakistan Regulatory Registry (PRR) to centralise all business regulations, beginning at the federal level and later expanding to provincial frameworks, aimed at improving regulatory transparency and investment clarity.

On external sector reforms, the State Bank of Pakistan will develop a roadmap for gradual removal of foreign exchange restrictions, sequencing liberalisation based on macroeconomic stability and financial sector readiness. Energy sector conditions have been further tightened. The IMF has added requirements for strict implementation of quarterly tariff adjustments (QTAs) and automatic monthly fuel cost adjustments (FCAs), along with full enforcement of annual electricity pricing reforms by January 2027.

Gas pricing reforms will also follow a cost-recovery model, with semiannual adjustments scheduled for July 1, 2026, and February 15, 2027, as determined by OGRA. On tax administration, the Federal Board of Revenue (FBR) will centralise audit case selection by June this year, supported by a standardised audit manual and risk-based compliance system focusing on high-risk taxpayers and non-filers. Public procurement rules will be revised by September to eliminate preferential treatment for state-owned enterprises in competitive bidding, subject to federal cabinet approval.

To cushion social impact, the Benazir Income Support Programme (BISP) stipend will increase from Rs14,500 to Rs19,500 starting January 2027, aimed at offsetting inflationary pressures and improving coverage relative to the consumption basket of low-income households. So far, the IMF has released $3 billion under the programme, while the next tranche of $1 billion is expected in early May, officials said.