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IMF urges government to stop subsidizing petroleum products

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Abdul khalique

ISLAMABAD: Pakistan is holding initial virtual consultations with the International Monetary Fund (IMF) to set key targets for the upcoming budget.

According to sources, the IMF is demanding that the Pakistani government not continue subsidizing petroleum products but make timely adjustments to energy prices to avoid financial burden.

The IMF says that timely adjustments to energy and fuel prices are necessary to avoid financial burden, and the proposals of regulatory bodies regarding energy and electricity rates should be implemented immediately.

The International Monetary Fund advised the government to follow the proposals of regulators regarding energy and electricity rates, and also suggested reducing tax exemptions, discounts and concessions in the new budget.

Proposals to expand the tax net and further reduce expenses are under consideration for the upcoming budget, and an annual increase of at least one percent in the tax-to-GDP ratio is proposed. It also directed that steps be taken to reduce the debt burden.

According to sources, the IMF has been emphasizing the reduction of subsidies and alignment of fuel prices with international market trends as part of ongoing economic review discussions. This could lead to a possible upward revision in petrol and diesel prices in the upcoming price notification.

Abdul khalique

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