IMF Imposes New Bailout Conditions on Pakistan

The International Monetary Fund has imposed 11 additional conditions on Pakistan under the second review of its $7 billion bailout programme, intensifying pressure on Islamabad to address long-standing governance and economic weaknesses. With these additions, the total number of IMF conditions has risen to 64 within 18 months, underscoring concerns over Pakistan’s reform pace and institutional capacity.

Focus on Governance and Corruption

According to the IMF’s staff-level report, the new conditions primarily target governance failures and entrenched corruption described as “deep-rooted distortions” in Pakistan’s economy. A key requirement mandates the public disclosure of asset declarations by senior federal civil servants by December 2026. These disclosures must be hosted on an official government website to enhance transparency and accountability. The government also plans to extend this requirement to senior provincial officials in a phased manner.

Stronger Oversight and Institutional Powers

The IMF has directed Pakistan to strengthen oversight mechanisms across high-risk government departments. By October 2026, action plans must be released for 10 departments identified through corruption risk assessments. The National Accountability Bureau will coordinate these efforts. Provincial anti-corruption bodies are set to gain enhanced authority, including access to financial intelligence and the power to conduct independent investigations, marking a significant shift towards decentralised accountability.

Economic and Sectoral Reform Agenda

Beyond governance, the conditions include wide-ranging economic reforms. Pakistan must submit a comprehensive roadmap to reform its revenue board, alongside a medium-term tax strategy. The IMF has also called for a review of remittance costs and cross-border payment barriers. Structural reforms extend to politically sensitive sectors, including the liberalisation of the sugar market and measures to cut losses in the power sector as a precondition for private-sector participation in distribution companies.

Exam Oriented Facts

• The IMF bailout package for Pakistan is valued at $7 billion.
• Pakistan has received around $3.3 billion under the programme since 2024.
• The National Accountability Bureau is Pakistan’s primary anti-corruption agency.
• IMF programmes often include fiscal, structural, and governance reforms.

Fiscal Risks and External Dependence

The IMF has warned that Pakistan must introduce a mini-budget next year if revenue targets are missed, highlighting ongoing fiscal risks. The country remains heavily dependent on external financing from multilateral lenders such as the IMF and World Bank, with the latest conditions reflecting international concern over Pakistan’s ability to deliver sustainable economic and governance reforms.