Pakistan pledges to meet five IMF conditions for resumption of $6 billion loan program

A man walks past the IMF Headquarters in Washington, US, on September 30, 2016. (AFP/File)
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Updated 23 November 2021
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Pakistan pledges to meet five IMF conditions for resumption of $6 billion loan program

  • The two sides reached a staff level agreement after weeks of negotiations, though it still awaits approval of the IMF executive board
  • The government has decided to increase tax on petroleum products, approve State Bank autonomy and reform general sales tax

KARACHI: Pakistan’s finance chief said on Monday the country would take “prior action” by meeting five conditions laid out by the International Monetary Fund (IMF) for the revival of a $6 billion bailout package.
The international financial institution announced earlier in the day it had reached a staff level agreement with Pakistani authorities almost 50 days after the two sides started negotiating with each other ahead of the release of another loan tranche.
The agreement still awaits approval of the IMF executive board, following the implementation of fiscal and institutional reforms.
The fund said in its statement on Monday the completion of the review process would help Pakistan get 750 million special drawing rights, or about $1 billion, under the extended fund facility initiated in July 2019.
However, the South Asian state needs to meet five conditions before the IMF board meeting since it will not only ensure the release of the next loan instalment but also unlock funding from other multilateral lenders.
The country’s finance chief Shaukat Tarin said during a media briefing in Islamabad the government would meet the IMF demands by introducing supplementary finance bills, more popularly known as mini-budgets in Pakistan.
“People asked but I did not tell them, but let me now give indication that there will be prior actions,” he said, adding: “The five IMF conditions include general sales tax reforms [by ending exemption for all sectors and introducing a uniform 17 percent rate] which will be done in the form of supplementary finance bill.”




Pakistan's minster for energy, Hammad Azhar (left) and finance chief, Shaukat Tarin (right), addresses a press conference in Islamabad, Pakistan, on November 22, 2021. (PID)

He announced the petroleum development levy (PDL) would also be “increased by Rs4 per month to Rs30,” and the government would get a bill related to the autonomy of State Bank of Pakistan approved by parliament.
Other than that, the IMF wants to see the audit report of Pakistan’s COVID-19 expenditure.
Tarin said Pakistan would meet its PDL revenue target of about Rs356 billion which had been lowered from Rs600 billion.
He informed the country was also bound to provide details of the beneficial owners of the coronavirus vaccine supplying companies.
The finance chief also maintained the State Bank autonomy was in Pakistan’s interest since it would allow the central bank to independently set the monetary policy and exchange rate, as per the government’s agreement with the IMF.
Responding to questions about the revenue collection target, he said it had been increased from Rs5.8 trillion to Rs6.1 trillion.
The prolonged dialogue between the government and the IMF had exerted pressure on Pakistan’s currency which posted historic lows while the stock market also reacted negatively.
While it was expected that the national currency and stocks would look more vibrant after the two sides reached the agreement, the markets displayed little enthusiasm.
“Stocks fell after the State Bank of Pakistan announced it had raised the key policy rate by 150 basis points to 8.75 percent due to high inflation,” Ahsan Mehanti, chief executive of Arif Habib Corporation, commented.
“Slump in global equities and crude oil price, foreign outflows, dismal data on large scale manufacturing growth at 1.2 percent in September 2021 and surge in government bond yields played catalyst role in the bearish close,” he continued.
The Pakistani rupee also gave little response and only gained 0.27 percent from Rs175.24 to Rs174.77 against the United States dollar.
“The higher-than-expected hike in policy rate and yet another approval from the IMF board have offset the expected gains after the staff level agreement,” Samiullah Tariq, director research at Pakistan Kuwait Investment, said.
However, analysts hope for greater rupee appreciation following the IMF executive board meeting which is likely to take place in January 2022.


‘Look ahead or look up?’: Pakistan’s police face new challenge as militants take to drone warfare

Updated 14 January 2026
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‘Look ahead or look up?’: Pakistan’s police face new challenge as militants take to drone warfare

  • Officials say militants are using weapons and equipment left behind after allied forces withdrew from Afghanistan
  • Police in northwest Pakistan say electronic jammers have helped repel more than 300 drone attacks since mid-2025

BANNU, Pakistan: On a quiet morning last July, Constable Hazrat Ali had just finished his prayers at the Miryan police station in Pakistan’s volatile northwest when the shouting began.

His colleagues in Bannu district spotted a small speck in the sky. Before Ali could take cover, an explosion tore through the compound behind him. It was not a mortar or a suicide vest, but an improvised explosive dropped from a drone.

“Now should we look ahead or look up [to sky]?” said Ali, who was wounded again in a second drone strike during an operation against militants last month. He still carries shrapnel scars on his back, hand and foot, physical reminders of how the battlefield has shifted upward.

For police in the northwestern Khyber Pakhtunkhwa (KP) province, the fight against militancy has become a three-dimensional conflict. Pakistani officials say armed groups, including the Tehreek-e-Taliban Pakistan (TTP), are increasingly deploying commercial drones modified to drop explosives, alongside other weapons they say were acquired after the US military withdrawal from neighboring Afghanistan.

Security analysts say the trend mirrors a wider global pattern, where low-cost, commercially available drones are being repurposed by non-state actors from the Middle East to Eastern Europe, challenging traditional policing and counterinsurgency tactics.

The escalation comes as militant violence has surged across Pakistan. Islamabad-based Pakistan Institute for Conflict and Security Studies (PICSS) reported a 73 percent rise in combat-related deaths in 2025, with fatalities climbing to 3,387 from 1,950 a year earlier. Militants have increasingly shifted operations from northern tribal belts to southern KP districts such as Bannu, Lakki Marwat and Dera Ismail Khan.

“Bannu is an important town of southern KP, and we are feeling the heat,” said Sajjad Khan, the region’s police chief. “There has been an enormous increase in the number of incidents of terrorism… It is a mix of local militants and Afghan militants.”

In 2025 alone, Bannu police recorded 134 attacks on stations, checkpoints and personnel. At least 27 police officers were killed, while authorities say 53 militants died in the clashes. Many assaults involved coordinated, multi-pronged attacks using heavy weapons.

Drones have also added a new layer of danger. What began as reconnaissance tools have been weaponized with improvised devices that rely on gravity rather than guidance systems.

“Earlier, they used to drop [explosives] in bottles. After that, they started cutting pipes for this purpose,” said Jamshed Khan, head of the regional bomb disposal unit. “Now we have encountered a new type: a pistol hand grenade.”

When dropped from above, he explained, a metal pin ignites the charge on impact.

Deputy Superintendent of Police Raza Khan, who narrowly survived a drone strike during construction at a checkpoint, described devices packed with nails, bullets and metal fragments.

“They attach a shuttlecock-like piece on top. When they drop it from a height, its direction remains straight toward the ground,” he said.

TARGETING CIVILIANS

Officials say militants’ rapid adoption of drone technology has been fueled by access to equipment on informal markets, while police procurement remains slower.

“It is easy for militants to get such things,” Sajjad Khan said. “And for us, I mean, we have to go through certain process and procedures as per rules.”

That imbalance began to shift in mid-2025, when authorities deployed electronic anti-drone systems in the region. Before that, officers relied on snipers or improvised nets strung over police compounds.

“Initially, when we did not have that anti-drone system, their strikes were effective,” the police chief said, adding that more than 300 attempted drone attacks have since been repelled or electronically disrupted. “That was a decisive moment.”

Police say militants have also targeted civilians, killing nine people in drone attacks this year, often in communities accused of cooperating with authorities. Several police stations suffered structural damage.

Bannu’s location as a gateway between Pakistan and Afghanistan has made it a security flashpoint since colonial times. But officials say the aerial dimension of the conflict has placed unprecedented strain on local forces.

For constables like Hazrat Ali, new technology offers some protection, but resolve remains central.

“Nowadays, they have ammunition and all kinds of the most modern weapons. They also have large drones,” he said. “When we fight them, we fight with our courage and determination.”