WASHINGTON – The International Monetary Fund (IMF) has asked Pakistan to cut its energy subsidies, saying they were crippling the country’s economy
Calling the energy subsidies “inefficient and untargeted”, IMF spokeswoman Caroline Atkinson said these subsidies were consuming a large part of the country’s budget. She said the bulk of energy subsidies were being cornered by the people of a higher income group and large companies, adding that the government should make efforts so that the resources should go to the social, health, education sectors.
“Just to clarify, the action on energy subsidies, petroleum prices, was not a part of the IMF programme. However, energy subsidies consume a large part of the budget,” Atkinson said at a news briefing.
She said the IMF arrangement with Pakistan was supposed to end by the end of December but was extended for nine months. “That’s to give space for us to continue to discuss with the government the two further disbursements that are allowable under the programme and that continues to be the case.”
“What’s most important for our arrangement is the ability to discuss with the government, to agree with the government, on the measures that they are going to put in place the economy can support,” she said.
Govt to defer IMF-demanded
reformed GST: Prime Minister Yousaf Raza Gilani said on Friday his government would defer a key tax reform in a move sure to anger the US and the International Monetary Fund, Reuters reported. “We have deferred (the reformed general sales tax),” Gilani said in Karachi after a meeting with officials from the Muttahida Qaumi Movement (MQM). “We will not go forward until consensus is evolved,” Gilani said.
