Pakistan Government On Defensive After IMF Rebuke
Islamabad: Pakistan's minister of state for Finance and Revenue Aisha Ghous Pasha said that the country had not breached the agreement with the International Monetary Fund (IMF), saying "any shortfall in petroleum duties will be adjusted in coming months".
This statement came during the meeting of the National Assembly Standing Committee on Finance, hours after IMF insisted on sticking to policy commitments made by Pakistan, The Express Tribune reported.
The committee discussed the currency manipulation case and whether the responsible department took any firm action against this. However, neither the central bank nor the finance ministry has given any satisfactory response regarding taking action against the banks.
The question of sticking to policy came after the newly appointed Finance Minister Ishaq Dar reduced the prices of all petroleum products for the next fortnight by around five per cent -- reversing a policy of raising prices monthly through added levies to ensure enhanced revenues as agreed with the IMF.
Dar reduced the duty to Rs 32.42 on petrol but increased the rate to 12.58 per litre on diesel. Cumulatively, the rate on the two products should have been Rs 55 per litre against the current Rs 45 per litre rate, reported The Express Tribune.
"We have not violated the agreement with the IMF," the state minister said and added, "We still have time till December to recover any shortfall against the petroleum levy target."
She was responding to a question by MNA Ramesh Kumar who raised the issue of a statement given by former finance minister Miftah Ismail who termed Dar's move "reckless", saying it may carry adverse implications for the IMF programme.
Pasha said lower rates can be adjusted till December this year.
Pakistan's Finance Secretary Hamid Yaqoob Sheikh revealed that the government collected only Rs 22 billion on account of petroleum levy during the July-August period - a sum that appears significantly lower and could compromise the annual target of Rs 855 billion set for the current financial year.
The government also seems to be in violation of its commitment to further increase the power tariff by 91 paise per unit with effect from October 1, according to The Express Tribune.
The deputy finance minister said that Pakistan remained committed to the IMF programme and that the finance minister would take up the issue of relaxation in the deal with the IMF during his upcoming visit to the US.
Pasha said, "Pakistan will be unable to get funding from multilateral and bilateral creditors without the IMF deal," and added, "It is important for the country to stay in the programme."
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