An International Monetary Fund (IMF) delegation has reached Islamabad to begin the final round of discussions on Pakistan’s federal budget for the fiscal year 2026. The negotiations, which started earlier this week, are scheduled to continue until May 22.
According to Finance Ministry officials, the talks involve several major institutions, including the Federal Board of Revenue (FBR), State Bank of Pakistan, Planning Commission, Economic Affairs Division, and the Ministry of Petroleum. The key aim is to finalise revenue and spending plans that align with IMF conditions as Pakistan attempts to navigate its ongoing economic difficulties.
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Alongside budget planning, climate policy is taking centre stage. The IMF has linked part of its financial support to environmental reforms, citing Pakistan’s vulnerability to climate-related disasters. The country ranks among the top 15 nations most at risk from climate shocks.
As part of its climate commitments, Pakistan is expected to receive $410 million in climate financing through a broader $1.4 billion support package. The funding aims to help Pakistan shift towards greener development by supporting clean energy, limiting coal-based projects, and promoting electric vehicles. A 15% cut in greenhouse gas emissions by 2030 is also among the national targets.
Read More: Finance Ministry Discloses Purpose of IMF Teams Visit
The IMF has encouraged Pakistan to adopt green budget tagging and incorporate disaster risk strategies in its financial planning. While the Fund acknowledged some progress with the help of global partners, it noted that Pakistan’s capacity to handle climate challenges remains limited.
