Negotiations between Pakistan and the International Monetary Fund (IMF) on the third review of a $7 billion Extended Fund Facility (EFF) and the second review of the Resilience and Sustainability Facility (RSF) have not yet produced a staff‑level agreement, the IMF announced on Thursday, with discussions set to continue in the coming days.
The IMF’s end‑of‑mission statement, issued after meetings in Karachi, Islamabad and virtually, noted that while considerable progress was achieved in the talks that began on February 25, further deliberations are needed to fully assess the impact of recent global developments particularly escalating tensions in the Middle East on Pakistan’s economic outlook and the IMF‑supported programmes.
IMF mission chief Iva Petrova said that Pakistan’s implementation of the EFF remains broadly aligned with its commitments through February.
Discussions focused on key policy areas, including fiscal consolidation, maintaining a tight monetary stance to keep inflation within the target range set by the State Bank of Pakistan, and continuing reforms to increase the efficiency and sustainability of the energy sector.
Officials also highlighted the need to deepen structural reforms to accelerate economic growth, strengthen social protection programmes, and restore spending in critical sectors such as health and education. Progress was also acknowledged on reforms aimed at enhancing climate resilience under the RSF framework.
The IMF emphasised that the talks included a review of potential impacts from the conflict in the Middle East, such as higher global energy prices and volatile financial conditions on Pakistan’s balance of payments, external financing needs, and overall economic stability.
Negotiators had originally planned to conclude the review on March 11, but discussions transitioned to virtual format on March 3 after regional security concerns.
If the review is successfully completed, Pakistan could become eligible to receive about $1 billion under the EFF and roughly $200 million from the RSF by the end of April.
