- In press conference, finance minister says letter of intent will be sent back to IMF today
- Defends hike in price of petrol, says no new taxes imposed
Federal Minister for Finance and Revenue Miftah Ismail on Tuesday said that he was hopeful the International Monetary Fund (IMF) executive board would meet on August 29, after which the process to disburse funds to Pakistan will start.
“There were minor edits that needed to be made in the Letter of Intent (LoI) and they were sent to the IMF," said Miftah while addressing an important press conference in Islamabad.
"We have received the new LoI from the IMF, which would be signed today and sent back to the IMF.
“We are hopeful that the IMF board meeting would be held on August 29, after which disbursement of funds will commence."
Mentioning rupee’s recent appreciation, Miftah said that the dollar, which hit 239.94 last month, has been brought under control.
“From 1st to 15th August, the Pakistani rupee emerged as the best currency in the world, whereas Pakistan Stock Exchange (PSX) too, emerged among the best performing stock markets in the world.
“The rupee’s strength should reflect the strength of the economy, which at the end reflects the current account position,” he said.
The federal minister reiterated that Pakistan suffered a trade deficit of over $48 billion last fiscal year on account of an import bill of over $80 billion in comparison to exports of only $31.3 billion.
On government's latest move to increase the price of petrol, Miftah reiterated that the government did not impose any new tax and that the Oil and Gas Regulatory Authority (OGRA) determine price based on Platts (a provider of energy and metals information and a source of benchmark price assessments in the physical energy markets).
The government increased the price of petrol by Rs6.72 per litre, but reduced that of high-speed diesel (HSD) by Rs0.51 per litre.
After the revision, the new ex-depot price of petrol became Rs233.91 while the rate of high-speed diesel (HSD) went down to Rs244.44 per litre.
The old ex-depot price of petrol was Rs227.19 per litre while HSD was at Rs244.95 per litre.
“I did not say that the price of petrol will not increase. I said that I will not impose tax on petroleum products,” said Miftah.
“I am bound by every decision of the government and take responsibility,” he added.
Meanwhile, Miftah stressed that the government's next target is to control inflation.
"The risk of default has been averted, whereas Pakistan's bond yields have also improved. Our next target is to control inflation."
The finance czar said that three months ago it was difficult for Pakistani companies to open a Letter of Credit (LCs).
“Fortunately, the situation has improved considerably since then,” he said. "By curbing imports, the value of rupee improved."