Impasse in talks with IMF on debt surcharge


Pakistan and the International Monetary Fund (IMF) on Wednesday failed to break impasse on a new contentious is sue of permanently imposing a Rs3.82 per unit debt surcharge to recover Rs284 billion more from electricity consumers.

Against the government’s decision to impose the new surcharge for eight months (March-October 2023), the IMF has asked the government to keep the levy as a permanent fixture in electricity bills until the government settles the Rs800 billion circular debt parked in a company.

Meanwhile, confusion prevailed on Wednesday when the finance ministry took the position different from what the Power Division had communicated to the IMF a day earlier.

This once again underscored lack of coordination among key government departments, which is contributing towards an inordinate delay in reaching a staff-level agreement with the IMF.

A meeting between Finance Minister Ishaq Dar and the IMF Mission Chief Nathan Porter ended with a note that the two sides would meet again to sort out the issue, according to officials privy to these discussions.

Dar is set to leave for Uzbekistan on today on a two-day official visit. During the meeting, both the sides also discussed the issue of $11 billion external financing gap, which the IMF had projected for the current fiscal year.