Government assures relief for salaried individuals and potential reduction in electricity bills amid ongoing IMF negotiations and economic reforms.
Key Takeaways:
i) Finance Minister Muhammad Aurangzeb has assured relief for the salaried class in the upcoming budget.
ii) The government is working on reducing electricity bills.
iii) Pakistan has met all IMF targets, with a potential $1 billion loan tranche expected upon IMF approval.
Islamabad, Pakistan – April 11, 2025 – Pakistan’s Finance Minister, Senator Mohammad Aurangzeb, has announced that the upcoming federal budget will include relief measures for salaried individuals. Speaking to the media, the minister also indicated that the government is exploring ways to reduce electricity bills. This announcement comes as Pakistan continues to negotiate with the International Monetary Fund (IMF) and implement economic reforms.
The Asian Development Bank (ADB) projects Pakistan’s economy to grow by 2.5% in fiscal year 2025, with potential for further growth to 3% in 2026, contingent upon the successful implementation of ongoing reforms.
Pakistan has met all the targets set by the IMF, and the IMF’s Executive Board is expected to approve a staff-level agreement in May. This approval could unlock a $1 billion loan tranche for Pakistan, along with additional climate financing. The government has received numerous budget proposals from both the public and private sectors and is currently reviewing them.
The government is also working on tax reforms, including simplifying the tax return form and bringing tax policy directly under the Ministry of Finance’s oversight. The final budget, which will take effect from July 1, will be presented to the parliament for approval.
The Asian Development Bank (ADB) projects Pakistan’s economy to grow by 2.5% in fiscal year 2025, with potential for further growth to 3% in 2026, contingent upon the successful implementation of ongoing reforms. The IMF has also acknowledged Pakistan’s progress in its economic program, although it has emphasized the need for continued reforms in the tax and energy sectors.
