Pakistan to drop 168 provincial projects from federal budget under IMF pressure

The International Monetary Fund (IMF) has urged Pakistan to exclude provincially mandated development projects from its federal Public Sector Development Programme (PSDP), calling for strict adherence to expenditure responsibilities outlined under the 18th Constitutional Amendment.

Government sources told The Express Tribune that the upcoming federal budget is likely to omit 168 provincial development schemes worth a total of Rs1,100 billion. Of this, Rs300 billion has already been disbursed. The remaining Rs800 billion, the IMF insists, should now be funded entirely by provincial governments.

The move is part of the IMF’s broader strategy to enforce fiscal discipline and streamline the division of expenditure responsibilities between federal and provincial governments as part of Pakistan’s ongoing economic reform commitments under its loan programme.

Finance Minister Muhammad Aurangzeb is currently in New York ahead of high-level meetings in Washington. On the sidelines of the IMF Spring Meetings, he is expected to discuss rescheduling of Pakistan’s Chinese-guaranteed debt and meet with the IMF Managing Director and a senior official from the U.S. Treasury Department.