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Pakistan further removes fuel subsidies to win IMF funding -Finance Minister

Pakistan further removes fuel subsidies to win IMF funding -Finance Minister
© Reuters. FILE PHOTO: People wait their turn to get fuel at a petrol station, in Karachi, Pakistan June 2, 2022. Picture taken June 2, 2022. REUTERS/Akhtar Soomro

ISLAMABAD (Reuters) -Pakistan on Wednesday further removed fuel subsidies in a bid to trim the fiscal deficit and aimed at securing critical support from the International Monetary Fund (IMF), the finance ministry said.

“Government has decided to end subsidies on fuel and raise prices starting midnight” Finance Minister Miftah Ismail told reporters at a press conference.

This is the third cut in fuel subsidies since May 26.

In the wake of rising petroleum product prices in international market and exchange rate variation, maintaining the fuel prices at subsidized rate is increasing fiscal deficit and current account gap, the finance ministry said in a statement.

In addition, subsidies are putting pressure on country’s foreign exchange reserves, it added.

The IMF wants the South Asian nation to take strict measures to control its fiscal deficit in the face of a balance of payment crises.

Source: Investing.com

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