IMF Urges Pakistan to Phase Out Broad Fuel Subsidies

The International Monetary Fund has urged Pakistan to withdraw its broad fuel subsidy scheme and avoid expanding it, according to reports on its latest economic review.

Targeted Relief for Vulnerable Consumers

The lender recommended that assistance responding to higher oil prices should be limited, targeted at eligible beneficiaries and temporary.

The recommendation concerns the design of fuel support. It does not establish a new petrol price or confirm that Pakistan has already ended the scheme.

Energy Reforms Remain a Priority

The IMF also called for timely energy tariff adjustments, improved payment collections, lower gas-sector losses and measures to reduce production costs.

Financing Awaits Board Approval

The recommendations follow a staff-level agreement that could unlock approximately $1.21 billion for Pakistan. Disbursement remains subject to approval by the IMF Executive Board.