ISLAMABAD — The federal government has pushed the FY26 budget presentation to June 10, over a week later than initially planned, amid ongoing talks with the IMF and Prime Minister Shehbaz Sharif’s upcoming foreign visit, The Express Tribune reported.
The delay is attributed to the PM’s four-nation trip — starting May 25 — and pending decisions on expenditure heads. Sources told The Express Tribune that the government is also weighing a further hike in the petroleum levy beyond Rs78/litre to finance a larger Public Sector Development Programme (PSDP), now proposed at Rs1 trillion.
The Annual Plan Coordination Committee meeting, earlier scheduled for May 26 to approve macroeconomic targets and PSDP allocations, has been postponed indefinitely.
Federal Board of Revenue (FBR) Chairman Rashid Langrial confirmed that virtual discussions with the IMF would continue, focusing on tax targets and related matters. Minister for Planning Ahsan Iqbal cited Eid holidays and limited post-IMF negotiation time as key reasons for the delay.
High-level meetings with Deputy PM Ishaq Dar and coalition partners were held Friday to finalise PSDP priorities. Dar emphasised aligning development spending with the government’s URAAN Pakistan vision for inclusive, innovation-led growth.
On fiscal reforms, the government also convened a committee on implementing the National Fiscal Pact to enhance federal revenue capacity and address structural deficits.
Meanwhile, The Express Tribune reported that the IMF has withheld endorsement of the government’s plan to retire Rs1 trillion in circular debt through inflated dividends from state firms, raising concerns over PSO’s share price surge. The plan, now revised to exclude PSO, aimed to retire Rs170bn next year, including Rs19bn for PSO.
The IMF is also resisting additional power subsidies beyond Rs1.04 trillion and has urged a cap aligned with fiscal discipline goals. The government has trimmed other subsidies in response.
PM Shehbaz’s tour includes visits to Iran, Türkiye, Azerbaijan, and Tajikistan, where he will express gratitude for support during the recent conflict with India and attend the Glacier Conference in Dushanbe.
