ISLAMABAD (PEN) : The International Monetary Fund (IMF) has raised serious concerns over the federal government’s issuance of Rs344.64 billion in supplementary grants during the current fiscal year without seeking prior approval from the National Assembly, terming it a breach of the agreed fiscal discipline under Pakistan’s Extended Fund Facility (EFF).
According to an official document, the government allocated the funds to various sectors, including power, defense, disaster relief, and development initiatives, and is now seeking retrospective approval from the legislature.
IMF Terms Move a Breach of Fiscal Agreement
The IMF has stated that issuing supplementary funds of this magnitude without parliamentary sanction undermines the principles of budget transparency and accountability, key components of the EFF loan programme. The Fund emphasized that such spending must adhere to agreed budgetary protocols to maintain fiscal discipline.
Major Allocations Detailed
The document reveals that the largest allocation—Rs115 billion—was granted to Independent Power Producers (IPPs), a long-standing concern for the IMF due to its heavy toll on the national treasury.
Other notable allocations include:
Rs59 billion* for defense expenditures
Rs30 billion* for flood relief efforts in Sindh
Rs14 billion* for solarisation of agricultural tube wells
Rs23 billion* to enhance Pakistan Army’s anti-terrorism capacity
Rs3.7 billion* for the Reko Diq mining project
Rs520 million* for the Special Investment Facilitation Council (SIFC)
Rs7 billion* for parliamentarians’ development schemes
Rs6 billion* for the Federal Board of Revenue (FBR)
Expenditures by federal institutions including the Supreme Court, Islamabad High Court, and the Ministry of Interior were also covered under these supplementary grants.
Post-Facto Approval in Process
While the Ministry of Finance has moved to obtain post-facto approval from the National Assembly, the IMF’s reservations could complicate upcoming negotiations for future tranches under the EFF programme. The Fund is expected to seek assurances on compliance with parliamentary oversight and fiscal controls in future budgetary decisions.
This development comes at a critical time as Pakistan works to secure financial stability amid ongoing economic reforms and seeks continued international support.
