The International Monetary Fund on Saturday termed budget 2024-25 approval as not enough and demanded Pakistan to do more.
According to sources, IMF wants Pakistan to hike the electricity and gas rates from July 1 and immediately implement the NEPRA decision regarding the increase in gas and power tariff.
IMF also demanded the removal of tax exemptions and subsidies, terming them “essential” for the country’s economic recovery, sources added.
However, the IMF has lauded the government’s tough economic decisions in the budget, including the reduction of tax exemptions and subsidies, sources said.
The sources also reveal that there has been progress in the talks between Pakistan and the IMF. The Fund, they said, has welcomed the tough economic decisions in Pakistan’s federal budget and praised the positive role of political parties. The IMF has also appreciated the limitation of tax exemptions for economic improvement.
However, the IMF has reiterated its call for fiscal discipline despite the approval of the Federal Budget 2024-25.
Gas rates will increase to reduce subsidies in the upcoming fiscal year, aligning with IMF conditions for new loan programs.
An IMF delegation is expected in Pakistan in mid-July.
