Finance ministry opts for biannual reporting as Fund presses for quarterly updates
IMF reforms. Design: Mohsin Alam
ISLAMABAD:
Pakistan has again refused to accept a technical assistance mission by the International Monetary Fund (IMF) for the effective implementation of 142 actions aimed at addressing glaring weaknesses in the country’s governance and anti-corruption frameworks.
The IMF reiterated the offer during a review meeting of the $7 billion bailout package.
The Finance ministry politely declined the IMF technical mission, according to sources privy to the discussions.
It is not the first time that the IMF has sought to send a technical assistance mission to Pakistan to strengthen governance and tackle rising corruption.
The government refused the IMF’s technical assistance mission on the grounds that it has sufficient in-house capacity to implement the action plan, the sources added.
However, the government has already taken assistance from the United Kingdom’s Foreign and Commonwealth Development Office to implement the action plan, which was finalised in light of the IMF’s Governance and Corruption Diagnostic Assessment (GCDA) report.
Musharraf Rasool Cyan, also the technical member of the National Finance Commission from Khyber-Pakhtunkhwa, was part of the government’s team overseeing implementation.
The government had released the corruption diagnostic report with a delay of about two months and only after the IMF made it a prior condition for approving the $1.2 billion loan tranches.
To meet another IMF condition to address these vulnerabilities, Prime Minister Shehbaz Sharif unveiled the Fund-guided action plan comprising 59 priority actions and 83 complementary actions, bringing the total of required actions to 142 to be implemented over the next three years.
A recent report by the Global Think Tank Network (GTTN) – an independent body – criticised the IMF’s diagnostic report. It said the report is “analytically strong and unusually candid. Yet its omissions are consequential”.
According to the GTTN, the GCDA’s “enforcement mechanisms are weak, politically sensitive reforms are diluted or deferred, subnational governance is under-examined, and institutional independence is insufficiently secured”.
“Although concerns about politicisation are acknowledged, they are not matched by binding institutional redesign,” the GTTN said.
The GCDA flags the need for a more transparent procedure for key appointments, including the NAB chairman, but fails to call for widening the pool of candidates beyond the civil service, judiciary and military, which are widely seen as responsible for Pakistan’s current state, according to the GTTN.
The discussions are taking place virtually after the IMF mission left Pakistan due to heightened security concerns.
During the ongoing review talks, the IMF also asked the government to release quarterly reports on implementation of the governance action plan, the sources said. However, the Finance ministry was of the view that it may publish biannual reports on its website.
The IMF also inquired whether civil society representatives were included in the three implementation committees constituted to ensure effective implementation.
The government assured the IMF that it would incorporate civil society representatives in these committees, the sources added. However, there is a chance that the Finance ministry may opt for like-minded individuals to address the IMF’s concerns.
Three committees have been constituted for effective implementation: the Economic Governance Systems Committee headed by Planning Minister Ahsan Iqbal, the Tax Administration Committee led by the finance minister, and the Anti-Corruption and Anti-Money Laundering Committee chaired by the law minister.
These committees provide strategic oversight, ensure coordination across institutions and guide sequencing of reforms.
As part of the review discussions, the IMF has also scheduled meetings to further scrutinise Pakistan’s anti-money laundering and combating financing of terrorism regimes. To assess whether government entities were effectively coordinating, the IMF on Tuesday held a virtual meeting.
Pakistan has committed to the IMF that it will enhance investigation and prosecution of money laundering offences by removing legal ambiguity on requiring a predicate conviction, increasing the quality and quantity of Suspicious Transactions Reports, strengthening the capacity of law enforcement agencies for financial investigations, and improving cooperation on asset recovery.
It has also promised to strengthen accountability and integrity among high-level federal civil servants by initiating publication of asset declarations in 2026 and introducing risk-based verification of asset declarations.
