KARACHI: Mian Zahid Hussain, President Pakistan Businessmen and Intellectuals Forum & All Karachi Industrial Alliance, Chairman National Business Group Pakistan and Chairman Policy Advisory Board FPCCI has expressed cautious optimism following the announcement of a Staff-Level Agreement (SLA) with the International Monetary Fund (IMF).
The agreement, which concludes the second review of the Extended Fund Facility (EFF) and the first review of the Resilience and Sustainability Facility (RSF), is set to unlock a combined USD1.2 billion instalment.
In a statement, Mian Zahid congratulated the finance minister Mohammed Aurangzeb Khan and his economic team on securing the deal successfully. “This SLA is a testament to the difficult stabilization measures Pakistan has undertaken. The disbursement, comprising USD1.0 billion from the EFF and USD200 million from the RSF, is not just a financial injection; it is a critical signal of confidence to international markets and bilateral partners.”
Hussain noted the positive macroeconomic indicators acknowledged by IMF, including the strengthening of external buffers, which have seen SBP’s foreign exchange reserves climb to USD14.44 billion. He also pointed to the Fund’s recognition of a fiscal primary balance that is “surpassing program targets” and a current account that recorded its first surplus in 14 years during FY25, as key achievements.
However, Mian Zahid warned that this hard-won stability remains fragile and the SLA is not the finish line, but the start of a more difficult phase. “The business community understands that this agreement is contingent on a new set of stringent commitments. The government’s resolve to meet the FY26 budget primary surplus target of 1.6 percent of GDP will be severely tested. This requires a monumental effort in revenue mobilisation, and it must be achieved by broadening the tax base, not by further harassing existing taxpayers.”
Hussain highlighted the persistent challenges in the energy sector, noting the IMF’s continued emphasis on “timely tariff adjustments.” He stressed, “While cost recovery is necessary, it is not a sustainable solution. The circular debt can only be permanently resolved through a deep and decisive reform of our power distribution companies (Discos) and to privatise loss-making State-Owned Enterprises (SOEs) that drain the exchequer.”
He also pointed to the latest trade figures as a cause for concern. “While the current account has seen a surplus, the trade deficit for September 2025 alone stood at USD3.4 billion, with imports of USD5.9 billion far outpacing exports of $2.5 billion. This indicates that our stability is still built more on import compression than on a genuine, export-led boom.”
The government must use the breathing room provided by this $1.2 billion tranche to make the tough, structural decisions we have delayed for decades. This is the moment to accelerate the privatization agenda and implement reforms that enhance productivity and global competitiveness, he concluded.
Copyright Business Recorder, 2025
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