The International Monetary Fund (IMF) has urged Pakistan to reconsider the National Finance Commission (NFC) award with the provinces during discussions between Pakistani officials and the IMF as part of the second review of the $3 billion standby arrangement (SBA).
According to Article 160 of the Constitution, the distribution of revenues between the federation and the provinces is authorized by the president through an order of the NFC Award.
The newly formed government informed the IMF delegation that the provincial shares could not be reduced without a constitutional amendment and ensured the agreement of all provinces to a new formula.
Despite the 2010 NFC award initially being agreed upon for five years, there has been no consensus to revisit it since then.
Additionally, the IMF has requested a plan for the privatization of Pakistan International Airlines and other government entities.
During the discussions, the IMF delegation expressed concerns regarding the performance of the energy sector, as revealed by sources within the ministry.
Furthermore, the delegation was briefed on domestic financing, government guarantees, and expenses related to the health and education sectors during the meeting.
Approval from the IMF would unlock a $1.1 billion loan tranche for Pakistan.
