The government on Thursday jacked up the price of petrol by Rs 30 per litre with immediate effect. Federal Finance Minister Miftah Ismail told a press conference that the IMF program could not move forward without raising the prices of petroleum products.
Earlier in the day, the International Monetary Fund urged Pakistan to end subsidies on electricity and petroleum products to revive the programme.
According to a statement issued by the IMF, the IMF mission, led by Nathan Porter, held virtual and direct talks with Pakistani officials on policies to ensure economic stability and sustainable growth in Pakistan from May 18 to May 25.
The statement stated that the mission held constructive talks with Pakistani officials to reach an agreement on policies and reforms to conclude the seventh review of the pending reform program, which is supported by the IMF Extended Fund Facility arrangements.
The IMF said that significant improvements had been made during the mission, including high inflation and fiscal and current account deficits, while adequate protection was being ensured to end the sharp decline. In this regard, the implementation of the policy rate hike from May 23 was a welcome step.
It was informed that the promises made in the previous review in the financial sector have not been fulfilled and the authorities announced partial subsidies for fuel and energy in February, statement sated.
“The team emphasized the urgency of concrete policy actions, including in the context of removing fuel and energy subsidies and the FY2023 budget, to achieve programme objectives.” IMF added.