Pakistan’s largest conglomerates have urged the International Monetary Fund to support predictable and long-term economic policies, as IMF officials cautioned against pursuing rapid growth following recent stabilization gains.
Senior executives from around 18 major foreign and domestic corporations met IMF mission chief Iva Petrova during the Fund’s ongoing two-week review visit. The meeting was hosted by the Overseas Investors Chamber of Commerce and Industry (OICCI) and focused on taxation, energy costs, and declining exports, which have fallen more than 7 percent in the first seven months of the current fiscal year.
Business leaders pressed the IMF to back time-bound tax incentives and policy support aimed at boosting exports and attracting investment. They argued that high corporate taxes, levies on the salaried class, and the super tax are hurting profitability and weakening competitiveness. Some participants also called for faster privatization of power distribution companies to address inefficiencies and lower energy costs.
According to participants, Petrova stressed the importance of phased and sustainable economic growth to prevent a return to boom-and-bust cycles that have historically destabilized Pakistan’s economy. The IMF reportedly expressed overall satisfaction with progress under the current program but flagged continuing concerns related to taxation and the energy sector.
The mission’s visit comes at a time of rising social pressures. A recent official report showed poverty at its highest level in 11 years, unemployment at a 21-year peak, and income inequality at a 27-year high. The government has attributed part of this strain to tough stabilization measures implemented under the IMF-supported reform program.
Corporate representatives highlighted policy uncertainty and heavy taxation as key obstacles to growth. One conglomerate reportedly told the IMF delegation that various levies account for nearly 90 percent of its profits. Others pointed to barriers to exports and the competitive disadvantage faced by documented businesses due to widespread tax evasion in the informal sector.
Participants said Petrova acknowledged that broadening the tax base would take time and indicated that the IMF is reviewing the recently introduced captive power policy, with possible adjustments under consideration.
OICCI President Yousaf Hussain acknowledged improvements under the reform program, including stronger fiscal consolidation, a better primary balance, stabilization of the external account, and rebuilding of foreign exchange reserves. He noted that inflation is moderating, the financial sector remains stable, and recent credit rating upgrades reflect improved fiscal discipline and renewed international credibility.
However, Hussain emphasized that the next phase must shift toward growth. He called for a centrally coordinated, technocrat-supported medium-term reform program under a comprehensive National Economic Plan. He said such a framework should align fiscal, trade, industrial, energy, and human capital policies, with clear milestones and improved coordination between federal and provincial governments.
OICCI Secretary General M. Abdul Aleem also urged greater policy coherence and predictability. He advocated a rationalized tax and tariff regime, avoidance of retrospective taxation, timely refund payments, and simplified compliance procedures to help restore investor confidence and unlock Pakistan’s economic potential.
