Officials said Pakistan partially fulfilled the IMF’s condition of aligning electricity and gas tariffs with actual costs after increasing utility prices in recent months.

Sources added that the government has largely met the IMF’s demand for a market-based exchange rate by reducing artificial controls on the rupee’s value.

Pakistan has also implemented reforms related to the autonomy of the State Bank of Pakistan, addressing another major IMF requirement.

Authorities have attempted to satisfy the lender through additional taxation measures, increased revenue collection efforts and crackdowns on non-filers and undocumented economic activity.

However, officials acknowledged that several reform targets remain incomplete.

Sources said amendments related to agricultural income tax laws had been introduced, but effective implementation was still lacking.

The government has initiated work on digitising the Federal Board of Revenue and expanding the point-of-sale system, though the desired increase in the tax net has yet to be achieved.

Officials admitted the government has not been fully successful in reducing circular debt, while the energy sector remains one of the IMF’s primary concerns.

Progress on the privatisation and restructuring of electricity distribution companies has also fallen short of expectations.

The government has yet to significantly reduce the financial burden created by several loss-making state-owned enterprises, although the privatisation process of Pakistan International Airlines is said to be nearing completion.

Sources further said the government had reduced subsidies in the energy sector, but a fully targeted subsidy system has not yet been implemented.

Provincial fiscal surplus targets also remain unmet.

Pakistan has eased import restrictions and relaxed artificial foreign exchange controls, but the IMF continues to push for a fully free-market system.

Meanwhile, a policy framework for climate finance reforms has been prepared, though practical implementation is still in its early stages.