Pakistan finance minister hints at ‘Plan B’ as revival of IMF bailout hangs in balance

In this handout photograph, taken and shared by the Ministry of Finance, Pakistan Finance Minister Ishaq Dar (center) addresses the post-budget press conference in Islamabad on June 10, 2023. (Photo courtesy: Government of Pakistan)
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Updated 10 June 2023
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Pakistan finance minister hints at ‘Plan B’ as revival of IMF bailout hangs in balance

  • Ishaq Dar says Pakistan is expecting transfer of $2 billion and $1 billion from Saudi Arabia and UAE respectively before June 30
  • Minister says the government has levied only $697 million additional taxes in the budget to promote documentation of economy

ISLAMABAD: Pakistan’s finance minister Senator Ishaq Dar said on Saturday his government was looking for a ‘Plan B’ in case the International Monetary Fund (IMF) did not release a $1.1 billion tranche of the stalled $6.5 billion bailout program Islamabad secured in 2019.

The statement came a day after the minister presented a Rs14.46 trillion ($50.4 billion) budget for the next fiscal year, setting a tax collection target of Rs9.2 trillion ($32 billion) that is 23 percent higher than the last year’s and envisioning a 3.5 percent GDP growth.

The government’s fiscal plan was unveiled amid record inflation, a depreciating currency, and fast-depleting foreign exchange reserves. While it stated its intention to provide relief to financially vulnerable segments, the budget numbers were aimed at securing the tough IMF loan amount to stave off a balance of payments crisis.

“A Plan B is always there and that is self-reliance,” the finance minister said, addressing a post-budget press conference in Islamabad. “Pakistan will not default.”

“If we don’t get it, we have a plan ready …. we hope to receive $1.1 billion [tranche], but there is no chance for the tenth review now,” the finance minister said. “We will only be fair to get the money after the ninth review.”

Pakistan’s IMF bailout program has been stalled since November and is set to expire on June 30, with its 9th and 10th reviews still pending the IMF board’s approval.

The finance minister said Saudi Arabia and the United Arab Emirates (UAE) had given a commitment of $2 billion and $1 billion respectively to the IMF as external financing support to Pakistan. 

“We expect if this amount was not transferred to Pakistan by June 30, it will come next year then,” he said, clarifying that debt rescheduling from the multilaterals was not on the cards.

“We can always negotiate with the bilateral for an ease-out.”

The finance minister clarified that there was no need to reschedule domestic loans because it would be a “serious issue” if a sovereign country could not fulfil “requirement of own currency.” 

He said the nation would have to “learn to live” as the country could not print dollars to repay external debts.

“We are trying to mobilize exports and remittances for the external debt [repayments],” Dar said.

About the 3.5 percent growth target, he termed it modest, realistic and in line with the IMF projection, admitting that servicing was one of the biggest items in the budget that the government was “trying to reverse.”

The government has paid special attention to agriculture and information technology (IT) sectors in the budget and given them tax exemptions on seeds and the import of machinery, according to Dar.

The economy is out of the woods now as hectic efforts by the government halted further decline of the economy.

He defended the government’s tax and non-tax revenues as “realistic and achievable” that were set after thorough consultations with stakeholders.

The budget levied new taxes of just Rs200 billion ($697 million) as the tax revenue had increased from Rs7,200 billion in the previous fiscal year to Rs9,200 billion.

“These 200 billion rupees taxes are mostly to promote documentation or fix an anomaly. This is not inflationary,” he said, adding that Rs900 billion out of Rs1,074 billion subsidies allocated in the budget were only meant for the power sector.

“This was a major stumbling block between us and the IMF, we have to focus on it,” he said. “No new major subsidy is being given.”


‘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.”