ISLAMABAD: The International Monetary Fund (IMF) is conducting a Governance and Corruption Diagnostic Assessment (GCDA) in Pakistan, aimed at identifying corruption vulnerabilities within key state functions, including fiscal governance, central bank operations, market regulation, and the rule of law.

This initiative is part of Pakistan's commitment under the Extended Fund Facility (EFF) arrangement, as confirmed by the Finance Division. The GCDA is a critical component of Pakistan's broader efforts to address long-standing governance challenges and promote sustainable economic development. As outlined in the IMF’s country report released in October 2024, a structural benchmark was agreed to ensure that robust governance frameworks and anti-corruption institutions contribute to inclusive growth and the sustainability of reforms.

Corruption, weak business conditions, and bureaucratic red tape have long hindered Pakistan's socio-economic progress. Vested interests and entrenched political challenges have often obstructed necessary reforms, further exacerbating the country’s developmental challenges. To support this effort, the authorities in Pakistan have requested IMF’s capacity development support for the GCDA.

The assessment will be published by the end of July 2025, alongside an action plan to address the identified vulnerabilities and recommendations for corrective measures. This will serve as a roadmap for improving Pakistan’s governance framework and fostering greater accountability within its public institutions. In addition, the government is aiming to align with international standards by complying with the UN Convention against Corruption. This process is set to be formalized through regulations by September 2024, further demonstrating Pakistan’s commitment to addressing corruption and improving transparency. During the mission, which will remain in Pakistan until February 14, 2025, the IMF team will engage with key government institutions, including the Finance Division, State Bank of Pakistan, and the Federal Board of Revenue, among others. The goal of this engagement is to identify corruption vulnerabilities, promote transparency, and enhance institutional capacities to better combat corruption across Pakistan’s public sector. The GCDA, which is being carried out as part of the EFF program, is designed to identify priority structural reforms that Pakistan must implement to improve governance and accountability. The IMF has consistently supported efforts to enhance transparency, governance, and the rule of law, as these elements are crucial for maintaining macroeconomic stability and ensuring sustainable economic growth in Pakistan. 

Through this diagnostic assessment, the IMF aims to strengthen Pakistan's ability to tackle corruption and create a more favorable environment for growth and development.