IMF wants Pakistan to end price controls on key agricultural products

ISLAMABAD: The International Monetary Fund (IMF) has placed a significant condition on Pakistan, prohibiting the federal and provincial governments from setting support prices for agricultural products such as wheat, sugarcane, and cotton.

This requirement, part of a broader $7 billion bailout package, aims to reduce government spending and limit provincial control over subsidies.

Currently, the government manages prices for key crops and inputs, including fertilisers. However, under the IMF’s directive, these interventions must be gradually phased out.

By June 2026, the government will no longer be allowed to set prices or conduct procurement operations that affect the private sector, starting with the current Kharif crop season.

Additionally, the IMF has banned provincial subsidies on electricity and gas throughout the 37-month loan programme.

According to Profit, the government will also be restricted to buying commodities solely for its own use, selling them at market prices to ensure full cost recovery. This move is intended to prevent price distortions and supply chain disruptions caused by previous government interventions.

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