The seller needs to make the required repairs. If he refuses then you need to get a conventional loan or back out of the deal. Your agent should be able to negotiate the repairs since the seller will have the same problem with any other buyer who has FHA financing. Failing to make the repairs will limit his buyer pool. Better to deal with you and keep you in the deal.
The quick answer is, the repairs become a negotiation between the buyer and the seller, unless previously outlined in the Agreement.. The Seller and the buyer typically work out how the work will be done!