ISLAMABAD: Talks between Pakistan and the International Monetary Fund (IMF) continued in Islamabad, with discussions focusing on the proposed petrol relief scheme, energy-sector circular debt, state-owned enterprises and fiscal reforms, according to sources.

Sources said the IMF has stressed that petrol relief should be restricted to deserving and targeted beneficiaries rather than being provided universally.

The IMF has also urged the government to use existing systems, such as the Benazir Income Support Programme (BISP), for the disbursement of petrol relief to ensure that assistance reaches eligible households.

According to sources, the Fund expressed concern over the issue of circular debt in the gas and electricity sectors and called for measures to address the accumulation of liabilities.

The IMF also called for accelerating reforms in state-owned enterprises (SOEs) and stressed the need to complete amendments to laws relating to SOEs at the earliest.

The Fund has further sought details regarding a reported Rs853 billion discrepancy between the accounts of the federal and provincial governments, sources said.

The IMF also raised the issue of health and education expenditures, noting that agreed spending targets in these sectors had not been achieved.

Sources said the IMF stressed that Pakistan should move swiftly not only on fiscal targets but also on structural reforms agreed under the programme.

The ongoing review is significant for Pakistan, as its successful completion would pave the way for the release of around $1.2 billion in IMF financing, subject to the programme’s agreed conditions and approval procedures.