Pakistan has submitted a medium-term debt reduction framework to the International Monetary Fund outlining a plan to bring public debt down to 55.7% of gross domestic product by 2034.
According to the document, the government projects the debt-to-GDP ratio will fall to 67.4% next year, before declining further to 64.7% in 2028 and 61.6% in 2029. The framework then targets 56.8% in 2033 and 55.7% in 2034.
IMF officials stressed that tax reforms would be essential to achieve the targets. They warned that without expenditure control, the debt burden would not ease and the framework would be difficult to implement.
The IMF emphasized the need for structural reforms in the Federal Board of Revenue and the energy sector, saying progress in these areas was critical for sustainable debt reduction.
The fund also underscored the importance of widening the tax net, reducing losses of state-owned enterprises and addressing circular debt in the energy sector. Stabilizing external financing sources was cited as another key requirement for meeting the debt reduction goals.