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ISLAMABAD: The ongoing discussions between an International Monetary Fund (IMF) staff mission and Islamabad authorities were abruptly shifted to a virtual format on Monday following the regional crisis triggered by the recent attack on Iran by the United States and Israel. The IMF delegation, led by Iva Petrova, had to relocate immediately from Islamabad to Istanbul in response to this advisory issued by the global lending agency’s headquarters.
The team initially planned sectoral meetings with Pakistani officials but these were disrupted due to the ongoing crisis. Remaining scheduled interactions will continue through virtual platforms between Islamabad and Istanbul.
The IMF mission has commenced its deliberations on Pakistan’s Extended Fund Facility (EFF) third review and Resilience and Sustainability Facility (RSF) second review, according to a statement issued by the Fund. These discussions are expected to conclude by March 11th.
Earlier in the day, a kickoff meeting was held by Finance Minister Muhammad Aurangzeb, where both sides engaged in preliminary talks about the evolving regional security situation. They expressed uncertainty on how long this crisis would persist and stressed their intention to closely monitor developments while discussing potential contingency measures as discussions proceed.
This series of reviews is crucial for Pakistan’s economic future. The IMF mission began its engagement with State Bank officials and business entities in Karachi on February 25th, followed by a formal kickoff meeting on Monday. Further technical engagements will take place until this weekend, leading to policy-level talks early next week. A final wrap-up meeting with the finance minister is planned for March 11.
The discussions revolve around Pakistan’s third review of the $7 billion Extended Financing Facility (EFF) and second review of its $1.1 billion Resilience & Sustainability Facility (RSF). Finance Minister Aurangzeb had previously indicated that Pakistan was well-positioned for a successful program review, attributing this to recent favorable decisions on super tax by the Federal Constitutional Court.
The reviews cover not only Pakistan’s performance since the end of December 2025 but also forward-looking budget proposals based on current year performance. Authorities will examine provincial reviews concerning agriculture income tax and governance challenges, as well as draft an action plan to address these issues, expected to have considerable losses worth trillions of rupees.
Regarding procurement and accountability agencies, Pakistan faces scrutiny given their independence and institutional capacities. The IMF mission has identified the power sector as a key area under examination due to recent volatile policy decisions, including those affecting the industrial and residential sectors.
While Pakistan has met most quantitative performance criteria for the review period, it lags behind in indicative targets and structural benchmarks. This could affect future program implementation. On the technical side, nearly all seven quantitative indicators are expected to be met by Pakistan’s central bank and finance ministry.
Net international reserves were forecasted to be slightly below the $7 billion benchmark for September 2025, with December 2025 estimates at around $6.5 billion against the $6.5 billion ceiling target. Net domestic assets are projected at around Rs12.5-13.5 trillion, compared to the central bank’s anticipated target range of Rs14.9-15.1 trillion for September and December 2025.
Upon successful completion of these reviews, Pakistan will become eligible for disbursements under both programs: approximately $1 billion from the Extended Financing Facility (EFF) by April and an additional $200 million from the Resilience & Sustainability Facility (RSF).