Pakistan on Friday gave a comprehensive plan to the International Monetary Fund focusing on gradually removing fuel subsidy in view of availing a financial package, sources informed Bol News.
The plan proposed to the IMF focuses on giving subsidy to only poor starta of the society, furthermore, a detailed discussion on electricity losses and raising electric prices was also discussed in the meeting.
The sources privy to development said that budget and current account deficit also came in discussion, the government delegation gave its subsequent plan in that regard. Recommendations were shared to cut expenses. It is said that priorities of development budget was also taken into consideration.
A federal government under Finance Minister Miftah Ismail is currently in Doha to negotiate a relief package from the IMF to stabilise the economy alarmingly observing a downward spiral soon after the no-confidence vote against former prime minister Imran Khan succeeded.
The Pakistan stock market took a dip on Monday as the government decided to continue the subsidy on fuel and electricity prices which increased concerns over the deal with the International Monetary Fund (IMF).
Read more: Pakistan bourse closes in red over IMF deal ambiguity
An analyst at Pearl Securities said that a big drop was expected as the government decided to continue subsidies on fuel and electric prices.
“This move has elevated concerns over the scheduled resumption of the IMF programme which would delay funds to shore up the State Bank of Pakistan’s (SBP) depleting foreign exchange reserves hovering at $10 billion.
Moreover, the rupee is continuously under pressure touching historic highs. Likewise, the international oil prices are staying above $100/barrels,” he added.
Ahsan Mehanti at Arif Habib Corp said that the stocks fell across the board as investors weighed the plunge in rupee and record surge in Treasury bill yields near to 15.26 per cent.
“A slump in the global equities, uncertainty over the terms for the resumption of the IMF programme and delays over the approval of sought Saudi aid package played a catalyst role in the bearish close,” he added.
