Pakistan negotiates IMF loan terms amid energy debt and fuel price hikes

IMF Pakistan talks circular debt fuel price hike inflation rate auto policy

Pakistan is engaged in critical economic negotiations with the International Monetary Fund (IMF) regarding its ongoing loan programme. Key discussion points include the recovery of over Rs110 billion in provincial power-sector arrears through National Finance Commission (NFC) share adjustments and addressing the power-sector circular debt, which reached Rs1.675 trillion. The IMF has also requested technical data on the Draft Auto Policy 2026-31 and has urged the removal of the 1% sales tax concession on electric vehicles, suggesting it be raised to 18%.

While the IMF has reportedly expressed satisfaction with Prime Minister Shehbaz Sharif's economic policies and the Federal Board of Revenue's tax collection performance, structural challenges remain. The IMF has advised eliminating cross-subsidies on power usage for up to 200 units and implementing targeted subsidies through the Benazir Income Support Programme (BISP) by 2027.

Domestically, Pakistan's inflation eased to 10.3% in September 2026, down from 11.1% in August, though energy-related costs continue to exert pressure. Concurrently, the government has increased petrol prices by Rs2.10 per litre, bringing the cost to Rs392.76 per litre, and raised high-speed diesel prices by 30 paisa.

Entities

Federal Board of Revenue · International Monetary Fund · Mexico · Ministry of Finance · Oil and Gas Regulatory Authority · Pakistan · Pakistan Bureau of Statistics · Profeco · Shehbaz Sharif · Swiss National Bank

Claims

What the coverage asserts, and how many sources carry each claim.

[● 2 SOURCES] Pakistan's inflation eased to 10.3% in September 2026, down from 11.1% in August. www.latestly.com · www.news18.com
[○ 1 SOURCE] The federal government plans to recover over Rs110 billion in provincial power-sector arrears by deducting them from NFC shares. www.energyupdate.com.pk
[● 2 SOURCES] Petrol prices in Pakistan increased by Rs2.10 per litre, bringing the cost to Rs392.76. supernews.pk · theneutral.pk
[○ 1 SOURCE] The IMF has requested additional technical data and financial clarifications regarding Pakistan's Draft Auto Policy 2026-31. netmag.pk
[○ 1 SOURCE] The IMF has asked the Pakistani government to eliminate cross-subsidies on power usage for up to 200 units. islamabadpost.com.pk
[○ 1 SOURCE] The IMF is calling for the abolition of the 1% sales tax concession on electric vehicles in Pakistan, suggesting a hike to 18%. www.economy.pk
[● 2 SOURCES] Power-sector circular debt increased by Rs61 billion during the last fiscal year, reaching Rs1.675 trillion. www.energyupdate.com.pk · islamabadpost.com.pk
[○ 1 SOURCE] The IMF is reportedly satisfied with Prime Minister Shehbaz Sharif's economic policies and implementation. arynews.tv