Finance Minister Miftah Ismail said on Monday that he would inform the International Monetary Fund (IMF) that the previous PTI government’s fuel and energy subsidies could not be reversed because the “nation cannot endure it.”
Ismail, who is scheduled to leave for Doha today to participate in IMF talks for the resumption of a $6 billion loan program that has been stalled since early April, told media in Karachi that Prime Minister Shehbaz Sharif and PML-N supremo Nawaz Sharif had ruled out ending the subsidies.
According to the agreement reached by former finance minister Shaukat Tarin, Pakistan would have to raise diesel prices by more than Rs150 and petrol prices by Rs100.
“It will not happen. I have refused. Shehbaz Sharif sahb has refused. Nawaz Sharif sahb has refused,” Ismail added. “I am assuring you that I will not agree to [the terms] that Shaukat Tarin agreed.”
On February 28, the PTI announced a four-month freeze (until June 30) on petrol and electricity prices as part of a series of measures to provide relief to the public.
The PML-N had harshly criticized former Prime Minister Imran Khan’s government for “derailing” the IMF program with these subsidies, but despite being in power for more than a month, it has yet to reverse them.
The finance minister has stated repeatedly that these subsidies are unsustainable and cost the government billions of dollars.
The IMF has made the resumption of its program with Pakistan, as well as a $2 billion expansion, contingent on the cessation of these subsidies.
A team of officials from the State Bank of Pakistan and the Federal Board of Revenue, as well as Minister of State for Finance and Revenue Dr. Aisha Ghous Pasha and the finance secretary, have already arrived in Doha to negotiate with the IMF.
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