The group from the International Monetary Fund (IMF) has arrived at the Ministry of Finance to initiate budget negotiations with Pakistan.

The discussions commenced with an introduction session, initiating consultations for the formulation of the forthcoming government budget.

Sources indicate that a number of significant meetings have been arranged between the IMF team and the Ministry of Finance, as well as separate discussions with officials from the State Bank of Pakistan.

The IMF has sanctioned a $1.2 billion loan tranche for Pakistan.

Throughout the negotiations, both parties will evaluate essential budget objectives, tax revenue forecasts, and comprehensive fiscal reforms. The evaluation will also encompass advancements in energy sector reforms and privatization initiatives.

Sources indicated that preparations for the federal budget for the upcoming fiscal year are anticipated to be finalized within the next week. The budget will be developed according to the current economic conditions, and its objectives will be established in collaboration with the IMF prior to submission for parliamentary approval, as IMF confirmation of these objectives is a critical prerequisite.

The IMF mission is anticipated to stay in Pakistan until May 20 for more negotiations.

Pakistan may be approaching significant constitutional upheaval as deliberations over a potential 28th Constitutional Amendment intensify within political and policy spheres.

The administration has escalated discussions about the proposed 28th Constitutional Amendment, with the upcoming week in May deemed critical for its potential advancement.

Political sources indicate that atypical activity has been noted within essential state institutions as consultation meetings persist in anticipation of the forthcoming legislative initiative. Debates concerning the proposal have also reverberated in recent sessions of the National Assembly and Senate.

According to sources, the issue was addressed in a recent meeting between the President and Prime Minister Shehbaz Sharif, which included Speaker of the National Assembly Ayaz Sadiq and other top officials.

The Speaker has allegedly conducted comprehensive discussions with legislative leaders and is charged with fostering consensus among principal coalition partners, specifically the Pakistan Muslim League-Nawaz and the Pakistan Peoples Party.

The Pakistan Peoples Party (PPP) reportedly harbors qualms regarding critical elements of the proposed amendment. Efforts are being made to resolve these issues, with Prime Minister Shehbaz Sharif, Speaker Ayaz Sadiq, and Federal Minister Rana Sanaullah actively participating in negotiations, while Deputy Prime Minister Ishaq Dar is also apparently involved in the process.

Sources additionally asserted that plans for development projects in Sindh might be incorporated into the budget to garner support from the PPP.

A distinct consultative meeting was allegedly convened at the Presidency, featuring PPP Chairman Bilawal Bhutto Zardari and other party leaders, during which the Finance Ministry informed attendees about the NFC Award and budgetary allocation between the federation and provinces.

Sources indicate that the government is contemplating the introduction of the amendment by May 21, aiming for a wider political agreement. The anticipated modifications are likely to encompass amendments to the NFC Award and additional governance issues, although the establishment of new provinces is excluded from the present proposal, sources indicated.

Officials stated that negotiations are ongoing and legislators have been instructed to remain in Islamabad as discussions proceed.

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The State Bank of Pakistan confirmed on Wednesday that it received around $1.3 billion from the International Monetary Fund after the completion of the most recent evaluation of Pakistan’s economic reform program.

The central bank said on X that the IMF Executive Board approved the disbursement of SDR 760 million under the Extended Fund Facility (EFF) and a second tranche of SDR 154 million under the Resilience and Sustainability Facility (RSF) during its meeting on May 8.

The SBP reports that the total cash received is SDR 914 million, about $1.3 billion, transferred on May 12.

The central bank stated that the influx would be evident in Pakistan’s foreign exchange reserves for the week concluding on May 15.

Last Monday, the IMF sanctioned the third assessment of Pakistan’s reform strategy, facilitating the most recent disbursement. The disbursement comprises over $1.1 billion from the EFF and nearly $220 million from the RSF, resulting in a cumulative total of approximately $4.8 billion across both programs.

The IMF recognized Pakistan’s enhancing economic statistics but cautioned that the nation remains susceptible to external threats, especially due to instability associated with the protracted conflict in the Middle East.

“The authorities’ strong implementation, despite the Middle East war, has maintained economic stability and improved financing and external conditions,” the Fund said in its statement.

The IMF emphasized the necessity of upholding prudent economic policies and expediting structural changes to enhance resilience and guarantee sustained long-term growth.

Nigel Clarke, Deputy Managing Director of the IMF, emphasized the increasing global uncertainty, asserting that Pakistan must maintain disciplined macroeconomic management while accelerating reform initiatives to mitigate future economic shocks.

The SBP, in its semiannual economic report published on Tuesday, observed that while macroeconomic stability enhanced during the initial half of fiscal year 2026, ongoing tensions in the Middle East persist as threats to inflation, trade, remittances, and overall economic activity.