Analysts generally concur that the government is under intense pressure to fulfill its obligations to the International Monetary Fund (IMF) by showcasing a clear route to primary surplus and fiscal consolidation as Pakistan finalizes its federal budget for 2025–2026.
The budget is being molded in light of IMF oversight and budgetary restraints, with an estimated expenditure of Rs16.9 trillion. In order to preserve the trust of external creditors, policymakers must strike a balance between reform and restricted relief.
Fiscal strategy is still shaped by the IMF’s dual-program framework, which consists of the Resilience and Sustainability Facility (RSF) and the Extended Fund Facility (EFF). The government is anticipated to increase the revenue base, reduce untargeted subsidies, and prioritize discipline under these arrangements.
