Call for compassion: Pakistan seeks IMF flexibility amid flood crisis

By Muhammad MubashirPublished On 07 Oct 2025

As per details, Pakistan’s GDP growth for the ongoing fiscal year may drop from 4.2% to 3.5% due to the impact of recent floods, sources said.

The government has reportedly requested the IMF to revise the macroeconomic framework, reflecting the losses caused by the disaster.

According to sources, there were discrepancies between the government’s and the IMF’s projections during policy discussions.

Pakistani officials briefed the IMF that floods are likely to hurt both agricultural and industrial output, while global commodity price hikes could push inflation up to 8%.

The IMF has been informed that foreign exchange reserves are expected to remain around $15 billion by the end of the fiscal year.

The Fund cautioned that Pakistan faces serious external challenges, warning that regional instability could further strain the country’s external position.

It also noted that external shocks and commodity price volatility pose additional risks to growth and inflation.

Sources said both sides are preparing to finalize the draft of the Memorandum of Economic and Financial Policies (MEFP), and new structural benchmarks may be introduced for the next review.

Discussions also covered revisions to provincial primary budget surplus targets.

To ensure accurate flood damage assessment, Pakistan has written to the World Bank, Asian Development Bank (ADB), European Union, and UNDP, seeking technical assistance for a post-disaster needs assessment.

The government has pledged to present updated and verified loss estimates to the IMF in the coming weeks.