IMF urges end to subsidies, not hike in energy prices: Mandviwalla

IMF directive includes terminating existing subsidies, particularly in energy sector

News Desk May 14, 2024
The International Monetary Fund logo is seen during the IMF/World Bank spring meetings in Washington, US, April 21, 2017. PHOTO: REUTERS/FILE


Senator Saleem Mandviwalla revealed that the International Monetary Fund (IMF) has not pressed Pakistan to increase energy prices but does want it to phase out subsidies across various sectors, including energy.

In an interview with a private news channel, Senator Mandviwalla asserted that the international lender has not imposed any new conditions.

He stated that the global lender has neither mandated a rise nor a decrease in the prices of petrol, gas, or electricity, adding that its primary concern is that these commodities adhere to international standards.

Regarding subsidies, he highlighted the IMF's directive to terminate existing subsidies and abstain from introducing new ones, especially in the energy sector.

Read IMF sees further uptick in Pakistan’s inflation

The IMF hasn't specified fixed price adjustments but has provided a framework, he added.

Addressing concerns about the impact of subsidy cuts on the general populace, Senator Mandviwalla underscored that these subsidies predominantly benefited select sectors, offering minimal advantages to the public.

He clarified that the subsidies in question primarily serve specific interests, rather than benefiting the broader population. However, he noted the IMF's support for subsidies in alternative sectors like the Benazir Income Support Programme.

On the upcoming budget, Senator Mandviwalla acknowledged the challenges in providing relief to the public, citing fiscal constraints.

He admitted that granting relief in the upcoming budget will pose challenges due to limited fiscal space.
Anticipating the IMF's engagement with political parties, Senator Mandviwalla suggested that the IMF delegation might also meet with the main opposition party, the PTI.


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