Islamabad — Pakistan’s failure to meet three critical International Monetary Fund (IMF) conditions has ignited a fresh political rift between the Punjab government and the Centre, despite both being led by the Pakistan Muslim League-Nawaz (PML-N).
Prime Minister Shehbaz Sharif has directed the Ministry of Finance and the Federal Board of Revenue (FBR) to explain the missed targets, which included the Rs12.3 trillion tax goal, Rs50 billion in trader contributions, and a Rs1.2 trillion cash surplus from all provinces combined.
A Ministry of Finance report shows that the provinces managed a surplus of Rs921 billion — Rs296 billion short of target. Federal officials blame the shortfall on Punjab’s overspending, while Punjab accuses Islamabad of withholding its rightful NFC transfers and missing federal revenue projections.
Punjab Information Minister Azma Bukhari said the Finance Division retained Rs190.8 billion from Punjab’s June allocation. “If this amount had been released, our surplus would have been Rs539.2 billion, against a target of Rs630 billion. We committed this figure on the assumption that the FBR would hit its Rs12.97 trillion collection goal,” she said.
The FBR ultimately collected Rs11.744 trillion, missing the target by Rs1.23 trillion — one of the steepest shortfalls in the country’s history. Bukhari argued that Punjab’s surplus was directly proportional to FBR performance and that last-minute downward revisions in mid-June left the province with no room for fiscal adjustments.
Performance varied across provinces: Sindh missed by Rs16 billion, Khyber Pakhtunkhwa by just Rs2 billion, while Balochistan exceeded its target by Rs3 billion. Federal officials insist that all provinces received less than expected yet others delivered closer to IMF requirements.
Bukhari countered that the withheld Rs191 billion was shown as part of the federal government’s cash balance, artificially boosting its primary balance at Punjab’s expense.
With tensions mounting, the prime minister has sought written explanations from both the Finance Ministry and FBR over the missed commitments.