Pakistan Seeks IMF Deal Amid Economic Reforms

Pakistan's Finance Minister Muhammad Aurangzeb is optimistic about securing a new bailout deal with the IMF. During talks, Pakistan has been pressured to introduce tougher tax measures and undertake military pension reforms. The country presented a heavily taxed budget to boost public revenue, aiming to satisfy the IMF’s demands.

Pakistan's Finance Minister, Muhammad Aurangzeb, announced on Thursday that the government is hoping to finalize a deal with the International Monetary Fund (IMF) within this month to secure a fresh bailout package. He assured that discussions with the global lender are making 'positive' progress.

Struggling with a severe dollar shortage, Pakistan is making extensive efforts to clinch the IMF deal worth over USD 6 billion. In a briefing to the National Assembly's Standing Committee on Finance, Aurangzeb expressed optimism about a staff-level agreement by next month, despite the IMF pushing for tough decisions, including new taxes outlined in the recent budget.

The minister emphasized the need to increase Pakistan's tax-to-GDP ratio from 9% to 13% and revealed plans for a contributory pension system for the armed forces starting in 2025. Despite recent budget measures, the IMF remains unsatisfied, calling for additional taxes on the agriculture sector. Aurangzeb noted positive economic indicators and maintained foreign exchange reserves above USD 9 billion.