Pakistan says not opting out of IMF program but won’t raise power tariffs, taxes

Pakistani Finance Minister Shaukat Tarin (L) speaks at the conclusion of the US-Pakistan Trade and Investment Council meeting in Washington on April 27, 2009. (AFP/File)
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Updated 05 May 2021

Pakistan says not opting out of IMF program but won’t raise power tariffs, taxes

  • Finance minister Tarin said government had approached IMF to ask for more “space” to meet conditionalities on a $6 bln loan
  • Says the government has “alternate plans” if the IMF did not respond favorably to the request to relax conditions

KARACHI: Pakistani Finance minister Shaukat Tarin on Wednesday denied the country was opting out of an International Monetary Fund (IMF) program, saying the government had approached the IMF to ask it to ease “tough conditions” on a $6 billion loan.
The International Monetary Fund Executive board approved the three-year loan package for Pakistan in July 2019 to rein in mounting debts and stave off a looming balance of payments crisis, in exchange for tough austerity measures. In March this year, the IMF said after the latest payment, Pakistan had received total disbursements of $2 billion under the Extended Fund Facility.
“If people think we are moving out of the IMF program.. we are not doing this,” newly appointed finance minister Tarin told journalists at a press conference in Islamabad. “We will ask them to give us some space amid the third wave of COVID.”
Tarin said the government had “alternate plans” if the IMF did not respond favorably to the request to relax conditionalities, adding that authorities had held meetings with IMF and World Bank officials on the current state of the economy, and they had been “very sympathetic to our point of view.”
Tarin said the IMF was asking Pakistan to increase power tariffs and impose incremental taxes, which it did not have the “capacity” to do “because our common man is fed up of inflation, which has cascading effects.”
“Tariff increase is not the only way to increase money,” Tarin said. “Prime Minister Imran Khan is not willing to do that.”
Tarin said IMF and World Bank officials had been briefed that revenue generation, which grew by 92 percent prior to the pandemic, had fallen to 57 percent after the outbreak. 
The finance minister said the government had alternative plans to bring circular debt in check and stabilize the energy market. 
“All their [IMF] interest is that our circular debt is growing, that should be ceased and some stability should be brought in. We will prove to them that the measures we will take will do it.. that will happen,” Train said. 
About taxes, the finance minister said the government wanted to enlarge the revenue envelope through innovative means but gradually. 
“As they [IMF] said in 2019 to raise [tax collection] directly from Rs 3.8 trillion to Rs 5.5 trillion, that will not happen,” he said, adding: “This is wrong way of doing – we have to increase gradually and in next 7-8 years we will be at the 20 percent … Will bring revenue collection close to their target but not the way they are saying, by ending exemptions etc.”


Ex-PM Khan’s party says willing to negotiate with government over next elections

Updated 7 sec ago

Ex-PM Khan’s party says willing to negotiate with government over next elections

  • Among other modalities, PTI leaders want to discuss changes in the Election Commission of Pakistan
  • Punjab chief minister has reiterated his commitment to dissolve the assembly on Khan’s instructions

ISLAMABAD: Former prime minister Imran Khan’s Pakistan Tehreek-e-Insaf (PTI) party said on Thursday it was willing to discuss the modalities of the next general elections if the government was open to the idea of going to the polls ahead of schedule.
The PTI has been seeking fresh elections in the country since the downfall of its administration in a parliamentary no-confidence vote in April. Khan has held dozens of protest rallies across Pakistan while describing snap polls as the only way out of the prevailing political and economic turmoil.
The former prime minister announced his decision at a recent protest in Rawalpindi to dissolve the provincial legislatures of Punjab and Khyber Pakhtunkhwa where his party is in power, hoping to intensify pressure on the coalition administration at the center to announce an early election date.
“For sure,” said PTI senior vice president Chaudhary Fawad Hussain in a Twitter post, “if [the government] announces early elections we are ready to negotiate [the] framework of elections and changes in [the Election Commission of Pakistan].”
Khan has repeatedly said in recent days he wants early elections since the country’s economy is in a crisis state and his party wants to retrieve control of the situation before it is too late.
He has also expressed reservations over the workings of the country’s election regulatory authority while claiming that its officials have a bias against his party.
On Thursday, the former prime minister also held a meeting with the Punjab chief minister Chaudhry Pervez Elahi to discuss the overall political situation of the country and weigh the option of dissolving the provincial assembly.
“There will be no delay in dissolving the Punjab Assembly on Imran Khan’s instructions,” Elahi said in a Twitter post after the meeting.
He dismissed the possibility of governor rule in Punjab while pointing out it could not happen since the assembly was in session.
Elahi also challenged the federal government to bring a no-confidence motion against him, saying the move would fail again like before.
He added his political rivals were far behind in the number game.
It may be recalled the Punjab chief minister is Khan’s political ally and holds the top provincial position after reaching a political understanding with the PTI leadership.
He noted that his party endorsed all decisions made by Khan, adding it fully supported anyone it chooses to ally with.
 


Pakistan and UAE agree to harness ‘unexplored’ bilateral economic potential

Updated 01 December 2022

Pakistan and UAE agree to harness ‘unexplored’ bilateral economic potential

  • Pakistani finance minister identifies new areas of trade and investment while meeting the UAE envoy in Islamabad
  • Ishaq Dar says he is hopeful for the enhancement of bilateral relations between the two countries in the coming days

ISLAMABAD: Pakistan’s finance minister Ishaq Dar said on Thursday the United Arab Emirates (UAE) was working with his government in different sectors, though the two countries still had a great deal of economic potential that had not been harnessed and could benefit their people.

Dar made the observation during a meeting with the UAE envoy, Hamad Obaid Ibrahim Salim Al-Zaabi, at the Finance Division in Islamabad.

They both agreed that the two countries shared long-standing strategic relations while exchanging views on further strengthening the economic ties between them.

“Finance Minister Senator Ishaq Dar stated that Pakistan and UAE are engaging in various areas including energy, refinery, petroleum and trade,” said an official statement released after the meeting. “However, still a lot of potential remains unexplored. In this regard, the Finance Minister also highlighted various new avenues in which both countries can trade and invest.”

The UAE ambassador said his country was fully cognizant of Pakistan’s development related policies and was also interested in augmenting its investment in new economic sectors.

The finance minister welcomed the proposal while assuring the UAE ambassador of full support and cooperation from the government.

Dar said he was hopeful for the enhancement of bilateral relations between the two countries in the coming days.


England score record first-day Test total against Pakistan

Updated 01 December 2022

England score record first-day Test total against Pakistan

  • Four English batsmen scored centuries as the tourists cantered to 506-4 at the close of play
  • Australia in the past scored 494 against South Africa on the first day of a Test in Sydney in 1910

RAWALPINDI: England became the first team to score 500 runs on the opening day of a Test match Thursday, putting Pakistan to the sword in Rawalpindi.

Four English batsmen scored centuries as the tourists cantered to 506-4 at the close of play.

The previous record for runs on the first day was the 494 Australia accumulated against South Africa in Sydney in 1910.

More than 500 runs in a day has only been achieved on four other occasions -- three times by England and once by Sri Lanka -- but never on the opening day of a Test.

The record is the 588 England ran up on day two of a test against India in 1936.

Ben Duckett scored a maiden century to match fellow opener Zak Crawley’s ton at the beginning of the day.

The 28-year-old left-hander pulled Pakistan paceman Haris Rauf for a boundary to reach the three-figure mark, but was out for 107 a few balls later off-spinner Zahid Mahmood.

The milestone for Duckett came in his first Test in six years, after he debuted against Bangladesh in 2016 but was discarded after scoring just 110 runs in four matches.

Earlier, 24-year-old Crawley drove Pakistan pacer Naseem Shah to the cover boundary to reach his third Test century in his 29th match, but not before overturning a leg-before decision via review.

The lanky 1.96-metre (six-foot-five) batsman showed his intent right from the start of the match, hitting three boundaries off Naseem's first over of the day, and bringing up his half-century with another one off spinner Zahid Mahmood.

He narrowly missed the chance to become the first England batsman to score a century before lunch, falling nine short.

England’s robust batting was the ideal start to the Test -- their first in Pakistan in 17 years -- after it hung in the balance Wednesday when several visiting players came down with a mystery virus.


Pakistan capable of ‘fully’ controlling militancy, interior minister says after ‘alarming’ attack by TTP

Updated 01 December 2022

Pakistan capable of ‘fully’ controlling militancy, interior minister says after ‘alarming’ attack by TTP

  • Pakistan Taliban on Wednesday claimed attack on a truck carrying police officers on their way to protect polio workers near Quetta city
  • Attack came a day after Pakistani Deputy Foreign Minister traveled to Kabul for consultations with Afghan Taliban, including on growing TTP threat

ISLAMABAD: Federal Minister for Interior Rana Sanaullah said on Thursday the government was capable of “fully” controlling militancy in the country a day after the Pakistan Taliban (TTP) claimed responsibility for a suicide attack in the southwestern city of Quetta.

A suicide bomber blew himself up near a truck carrying police officers on their way to protect polio workers near Quetta on Wednesday, killing a police officer and three civilians from the same family who were traveling nearby in a car. The bombing also wounded over 20 others, mostly policemen, officials said.

The attack came a day after Pakistani Deputy Foreign Minister Hina Rabbani Khan was in Kabul for discussions with the Afghan Taliban, including on the latest threat from the TTP. Islamabad has been pushing Afghanistan’s Taliban government not to allow the TTP to use their soil to launch attacks inside Pakistan.

Speaking to reporters on Thursday, the interior minister called terror activities by the TTP ‘dangerous’ for peace and stability in the entire region, saying the Afghan Taliban should also be concerned about this.

“I assure the nation that we will fully control terrorism in the country. The TTP has accepted the responsibility of carrying out the attack in Quetta which is an alarming as well as a condemnable matter,” he said. “The TTP has access to all sorts of facilities in Afghanistan, so it should be a matter of concern for the government there.”

He said the TTP should not be seen as an “out-of-control” force but warned the provincial governments and law and enforcement agencies in the Balochistan and Khyber Pakhtunkhwa (KP) provinces where most attacks take place to take the matter seriously.

“I assure the provinces that full support will be provided by the federation. Political differences exist but the state comes first,” the minister said.

Wednesday’s bombing happened two days after The Pakistani Taliban ended a monthslong cease-fire with the government in Islamabad, ordering its fighters to resume attacks across the country, where scores of deadly attacks have been blamed on the insurgent group. In Monday’s statement, the outlawed TTP group said it was ending the five-month cease-fire after the army stepped up operations against the TTP.

Pakistan and the TTP had agreed to an indefinite cease-fire in May after talks in Afghanistan’s capital. 


Pakistan approves release of blocked payments, averting threat of suspension of Google services

Updated 01 December 2022

Pakistan approves release of blocked payments, averting threat of suspension of Google services

  • The central bank suspended direct carrier billing mechanism last September, blocking $34 million payment to international companies
  • DCB is an online mobile payment method that allows users to make purchases by charging payments to their mobile phone carrier bill

ISLAMABAD: Federal Minister for IT Syed Amin Ul Haque said on Thursday the country’s finance ministry had “agreed” to his proposal to release blocked payments to international companies like Google, averting a threat of the possible closure of services.

 

In September 2022, the country’s central bank had suspended a direct carrier billing (DCB) mechanism after which a $34 million payment through mobile companies to international service providers — including Google, Amazon, and Meta — was stuck.

DCB is an online mobile payment method that allows users to make purchases by charging payments to their mobile phone carrier bill. Telecommunications companies in Pakistan allow customers to purchase products through airtime and then remit funds abroad, reflecting such transactions as payments for the acquisition of IT-related services.

The suspension of the DCB mechanism gave rise to fears Pakistanis would now be required to use their bank cards to purchase services. This was a major concern in a country where 100 million people are unbanked.

“The State Bank of Pakistan had been directed to delay the implementation of the Direct Carrier Billing (#DCB) policy for one month,” Haque said.

“Telecom operators had been given a one-month time to implement payment procedures and within a month, the ministry of IT, finance, and the State Bank would formulate a plan of action in mutual consultation in that regard”.

 

The finance ministry and state bank have not yet commented on the development.

Haque said he took notice of the situation after receiving complaints from stakeholders, including the Telecom ministry, the Pakistan Telecommunication Authority (PTA) and cellular service operators. Following that, he wrote a letter to Finance Minister Ishaq Dar and requested his ministry to resume the payment so that paid Google apps would not be suspended in Pakistan.

The IT minister thanked Dar and Special Assistant to Prime Minister Tariq Bajwa for making a “timely decision on the issue.”