The International Monetary Fund (IMF) and Pakistan would start two weeks long virtual discussions on 7th review of Extended Fund Facility (EFF) from today (Friday).
An official of Finance Ministry said that two weeks virtual discussion of 7th review of the EFF would start from Friday. The government is expected to face tough questions from the IMF over the prime minister’s recently-announced package of relief on petroleum, diesel, and electricity prices.
The prime minister has announced Rs10 per litre reduction in petrol and diesel and Rs5 per unit cut in electricity price and stated that there would be no increase in their prices till the next budget. The government also announced industrial amnesty scheme, which, according to an official would be very difficult to defend during the discussion.
An official of the Finance Ministry said that as per working of the economic team the package announced by the prime minister would cost the exchequer between Rs250-300 billion.
The government would also suffer loss in non-tax revenue on account of petroleum levy consequent to the prime minister’s relief package when it had agreed with the Fund during the 6th review that it would increase Rs4 per litre petroleum levy on a monthly basis to achieve revised target on this account.
This story was first published in Business Recorder on March 4, 2022.