ISLAMABAD: The International Monetary Fund (IMF) and Pakistani authorities on Monday deliberated on revising downward the GDP projection to 3.5 percent for the current fiscal year against the government target of 4.2 percent, as recent floods caused damage to infrastructure, agriculture, and livestock, well-placed sources revealed to Business Recorder.
According to official sources, the talks are part of the ongoing IMF review mission in Islamabad, where both sides are examining the government’s policy actions and financing needs ahead of the release of the next tranche under the Extended Fund Facility (EFF).
IMF projects Pakistan’s GDP growth at 3.6% for FY26, below govt target of 4.2%
Sources further revealed that in view of the damages caused by recent floods and external factors, an increase in inflation is anticipated. During the talks inflation target was deliberated upon and projected to be in the range of 7-8 percent for the current fiscal year, while foreign exchange reserves are projected to be around $14.5 billion.
Current account deficit was estimated to be around $1.495 billion, exports around $32.981 billion, while imports were estimated to be around $59.6 billion, which may result in to trade deficit of around 27 billion by the end of the current fiscal year. Remittances are expected to be projected to be around $36 billion.
Negotiations will continue in the coming days, covering broader structural reforms, tax revenue measures, and external financing needs. The government side termed the latest round of discussions “constructive,” with the Fund emphasizing effective implementation as a prerequisite for disbursements.
Copyright Business Recorder, 2025
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