Govt notifies new procurement rules with IMF team in town

As the International Monetary Fund (IMF) team arrives in Pakistan to discuss disbursement of a $1.2 billion loan, the government has simultaneously notified new procurement rules to address concerns over the ongoing breach of structural benchmarks for the Sovereign Wealth Fund (SWF) law. The IMF delegation, led by Iva Petrova, met with finance, tax, and other officials to address the uncertainty surrounding the SWF law.

The new Public Procurement Rules 2026 were issued to promote transparency and competition in public procurement while retaining exemptions for direct contracting with state-owned enterprises (SOEs). However, the IMF had reservations about such preferential treatment. Rule 32 permits direct contracting with SOEs under specific circumstances, such as time-sensitive or urgent projects, while limiting bidding to national firms.

Among the SOEs in question are OGDCL, PPL, Mari Petroleum, National Bank of Pakistan, Govt Holdings, Pakistan Development Fund, and the Neelum-Jhelum Hydropower project. These entities, collectively worth $8 billion, are state-listed but exempt from regular reporting requirements. The amendments to the SWF law are pending parliamentary approval.

Under the new rules, the Public Procurement Regulatory Authority (PPRA) will enforce greater accountability through measures such as mandatory use of EPADS (E-Pak Acquisition and Disposal System) for public procurement, establishment of dedicated procurement cells, and third-party validation and inspection for large procurements. The rules also strengthen enforcement procedures with provisions for blacklisting, cross-debarment, and an independent grievance redressal committee.

The government maintains that the new rules will improve efficiency, sustainability, and inclusivity in public procurement, while safeguarding national interests and the SOEs' critical roles in the economy.