An International Monetary Fund (IMF) mission arrived in Islamabad on Monday for its biannual review of the $7 billion bailout deal.

In July, Pakistan and the IMF finalised a three-year, $7 billion aid package designed to help the country establish macroeconomic stability and foster stronger, more inclusive growth.

The 37-month Extended Fund Facility programme includes six reviews throughout the duration of the bailout. The release of the next tranche, approximately $1 billion, will depend on the outcomes of the forthcoming performance review.

A key focus for Pakistan in this loan agreement is increasing the tax-to-GDP ratio, which is essential for stabilising the economy and managing debt. In 2024, the salaried class emerged as the third-largest contributor to income tax, ranking behind banks and the petroleum sector while surpassing textile exporters.

The economic review negotiations with the IMF would continue until March 15 and would be conducted in two phases, sources said. The first phase would focus on technical discussions while the second phase would involve policy-level dialogue.

A nine-member IMF delegation, led by Nathan Porter, would stay in Pakistan for approximately two weeks. In the negotiations, the delegation is expected to present its proposals for the upcoming fiscal year 2025-26 budget. If the Fund’s approval is secured, there may be relief for the salaried class, sources said.

The IMF team has scheduled talks with various institutions, including the Ministry of Finance, the Ministry of Energy, the Ministry of Planning, and the State Bank of Pakistan. Moreover, meetings would be held with officials from the Federal Board of Revenue, Oil and Gas Regulatory Authority, and National Electric Power Regulatory Authority to discuss the challenges facing Pakistan’s economy and necessary reforms.

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Last month, Aurangzeb confirmed that the team would evaluate the federal government’s advancement on critical conditions set by the IMF.

He emphasized that reforms related to technology processes within the FBR would continue with steadfast commitment. Aurangzeb highlighted the importance of reforming state-owned enterprises and advancing the privatisation agenda as positive steps for the country’s economic future.

The finance minister also mentioned plans to incentivise exports while implementing stricter border controls. He pointed out that sugar was leing exported legally rather than smuggled into Afghanistan for the first time. “We need every single dollar for our own country,” he stated.