Pakistan has formally sought the consent of the International Monetary Fund (IMF) to impose a new municipal tax in the federal capital, aiming to finance the ambitious Rs213 billion Jinnah Medical Complex project. The request highlights the government’s struggle to generate sufficient resources for large-scale healthcare infrastructure, as fiscal space remains limited amid competing national priorities.
According to official sources, the proposed tax would directly support the construction of a 1,000-bed tertiary care facility in Islamabad, designed to serve as a state-of-the-art medical and research hub. The Jinnah Medical Complex will feature multiple Centers of Excellence, providing advanced healthcare solutions and addressing Pakistan’s growing demand for modern medical services. The government has set an ambitious completion target of July 2028, underscoring its urgency in addressing the widening healthcare gap.
The IMF, however, has requested additional details before granting approval. This comes as an IMF mission prepares to arrive in Islamabad on September 25, ahead of discussions related to the release of a $1 billion tranche under the existing loan programme. The visiting team is expected to remain in the country until October 8, during which time the new tax proposal is likely to form part of broader fiscal discussions.
Government insiders revealed that as an interim step, the finance ministry is considering utilizing contingency budget pools to release at least Rs30 billion immediately. This would enable initial construction activity for the complex. At the same time, supplementary grants and reallocation of funds from other projects remain under review as alternate financing strategies.
Planning and Development Minister Ahsan Iqbal confirmed that the Executive Committee of the National Economic Council (ECNEC) has established a dedicated committee to address the project’s funding constraints. He added that the government has already released Rs3.5 billion as seed money, earmarked for the creation of the Jinnah Medical Complex Company and recruitment of project staff.
The committee, chaired by the planning minister himself, also includes secretaries from the ministries of Finance, Planning, and National Health Services. Its mandate covers not only resource mobilisation but also ensuring physical progress of the project remains on schedule.
Officials further disclosed that the government may consider utilising $76 million, or Rs21.5 billion, in expected proceeds from Panda bonds to partly fund the complex. However, the finance ministry maintains that this amount should be classified under the existing Rs1 trillion Public Sector Development Programme (PSDP) rather than as an additional financing stream.
Earlier, the Central Development Working Party (CDWP) had advised the health ministry to finalise a concrete funding mechanism, including contributions from Panda bonds, Islamabad’s municipal taxes, and potential corporate social responsibility allocations from state-owned enterprises. Despite these directions, concrete commitments remain scarce, leaving a gap in the Rs213 billion financing requirement.
The Jinnah Medical Complex, as outlined in project documents, will rise near the new Islamabad International Airport as a 15-story facility constructed in two phases. Phase I is scheduled for completion within 30 months of fund release, while Phase II is expected to conclude within an additional two years.
Healthcare experts argue that the facility is a critical necessity, given Pakistan’s current ratio of just five hospital beds per 10,000 people, significantly lagging behind India’s 16 and other regional benchmarks ranging from 9 to 22. With Islamabad’s population having surged fivefold since 1984 to nearly 1.3 million in 2024, demand for medical services has far outpaced infrastructure growth. Few large-scale public hospitals have been built since 1985, intensifying the pressure on existing facilities.
The government’s efforts to mobilise international and domestic resources for the Jinnah Medical Complex reflect a broader challenge: balancing fiscal responsibility under IMF oversight while addressing urgent development needs. Whether the IMF approves the new tax or directs Pakistan toward alternative measures will determine the speed at which this vital healthcare project moves forward.
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