IMF Mission to Visit Pakistan for Second Review Talks Amid Flood Impact

ISLAMABAD — The International Monetary Fund (IMF) mission will visit Pakistan on September 25 for the second review talks under a $7 billion Extended Fund Facility (EFF) program.

Due to recent devastating floods, Pakistan may have to revise its economic targets, including lower GDP growth, higher inflation, and changes in exports and imports.

The GDP growth forecast may be lowered from 4.2% because of damage to the agriculture sector. Inflation could rise beyond the expected 5-7% due to supply disruptions of food items. Exports, especially rice, might decline, while imports may increase due to flood damage.

Before the floods, Pakistan’s trade deficit had already widened. The IMF will also discuss the Agriculture Income Tax (AIT) and its potential for revenue collection.

The government faces challenges in meeting tax revenue targets for September 2025, especially after floods affected tax collection in Punjab and other regions.

Another issue is the delayed release of the Governance and Corruption Diagnostic (GDC) report, which the IMF planned to publish by August but has not yet done so due to lack of government permission.

The IMF mission will run from September 25 to October 8 and includes technical talks and policy-level negotiations with federal ministries, regulatory bodies, and provincial governments.

Pakistan has so far received $2.1 billion from the $7 billion EFF program. To get the next $1.1 billion tranche, the government must show progress on reforms and reduce the fiscal gap.

The Federal Board of Revenue (c) has a tough task to collect Rs 3.1 trillion in tax revenue from July to September but is currently behind schedule due to flood-related losses.

The talks will focus on adjusting economic policies to reflect the current realities caused by floods and economic challenges.