IMF Seeks Greater Autonomy for State Bank of Pakistan

The International Monetary Fund (IMF) has raised fresh demands for Pakistan, emphasizing the need for enhanced independence of the State Bank of Pakistan (SBP). The proposals are part of the IMF’s Governance and Corruption Diagnosis Assessment Report, which highlights key governance reforms required to strengthen Pakistan’s financial system.

According to sources, the IMF has recommended amendments to the State Bank Act to further reduce government interference in monetary policy decisions. Among the key recommendations is the removal of the federal secretary of finance from the SBP’s Board of Directors, ensuring impartiality and insulating the central bank from political influence.

The report also flagged concerns over critical leadership gaps, noting that two out of three deputy governor posts at the SBP remain vacant. The IMF has urged Pakistan to fill these positions without delay to improve oversight and operational effectiveness.

Additionally, the Fund called on Islamabad to end government interference in commercial banks, stressing that the SBP must have complete independence in regulating and monitoring the financial sector. These reforms, the IMF argues, are vital to ensuring stability, transparency, and efficiency in Pakistan’s banking system.

Officials at the Ministry of Finance have confirmed that discussions with the IMF are ongoing. The recommendations are expected to form part of broader policy negotiations linked to future loan disbursements and long-term reform commitments.