IMF Tightens Noose on Pakistan: 11 New Conditions Imposed on $7 Billion Bailout to Target Corruption and Elite Capture
Total Structural Requirements Rise to 64 as Fund Demands Public Asset Disclosure for High Officials and Immediate Liberalisation of Cartel-Dominated Sugar Sector
Total IMF Conditions Balloon to 64 Requirements
The International Monetary Fund (IMF) has intensified its oversight of Pakistan’s economy, imposing 11 new structural conditions on the ongoing $7 billion Extended Fund Facility (EFF). The fresh directives, outlined in the Fund’s staff-level report released this week, increase the total number of compliance requirements Pakistan must meet within an 18-month timeline to a staggering 64. This escalation underscores the IMF’s deep concern regarding the slow pace of structural reforms and persistent governance failures.
The additional requirements transform the bailout program into a comprehensive, accelerated blueprint for systemic overhaul, focusing heavily on reducing the risks of elite capture and systemic corruption that have plagued the Pakistani economy for decades. Failure to meet these new, challenging benchmarks will directly jeopardize the release of future tranches of the much-needed financial assistance.
Direct Targets Set for Corruption and Transparency
In a direct bid to enhance transparency and combat high-level corruption, the IMF has introduced one of its most stringent conditions: the mandatory public disclosure of asset declarations for high-level federal civil servants. This requirement must be implemented on an official government website by December 2026, allowing banks and regulatory bodies full access to the data to identify glaring mismatches between declared income and actual assets.
Furthermore, the IMF has mandated decisive action against powerful lobbies. By June 2026, both federal and provincial administrations must agree and adopt a national policy for sugar market liberalization, directly targeting the entrenched influence of politically connected business groups that control the sector.
Mini-Budget and Power Sector Reforms on the Horizon
The IMF has also intensified pressure on Pakistan’s fiscal machinery. The persistently underperforming Federal Board of Revenue (FBR) must finalize a detailed reform roadmap by December 2025, which includes staffing needs and clear Key Performance Indicators (KPIs).
Perhaps most immediately concerning for Islamabad is the IMF’s explicit warning: should tax revenue collections fall short of targets by the end of December 2025, the government will be required to introduce an immediate “mini-budget.” This measure would likely involve increasing excise duties on essential items and widening the sales tax net. Additionally, the new conditions demand the finalization of preconditions for private-sector participation in major, loss-making power distribution companies (HESCO and SEPCO) before the next federal budget to curb the crippling circular debt. The sheer volume and sensitivity of these reforms will severely test the political will and administrative capacity of the current government.