ANI
02 Feb 2023, 19:03 GMT+10
Karachi [Pakistan], February 2 (ANI): Amid talks with International Monetary Fund (IMF) to complete the pending ninth review under the USD 7 billion Extended Fund Facility (EFF), Pakistani Rupee lost its ground against the dollar in the interbank market on Thursday, reported Geo News.
During intraday trade, the rupee depreciated by Rs 1.17 and was trading at Rs 270. The rupee had closed at Rs 268.83 on Wednesday.
Capital market expert Saad Ali told Geo News that reports regarding the rejection of the circular debt management plan (CDMP) presented by the government to the International Monetary Fund (IMF) had dented the market's confidence.
Ali said that these reports created doubts about the possibility of a bottleneck in the ongoing government-IMF talks, reported Geo News.
Meanwhile, IMF rejected Pakistan's revised Circular Debt Management Plan (CDMP).
It has called on the Pakistan government to increase the electricity tariff in the range of Pakistani Rupees (PKR) 11-12.50 per unit to restrict the additional subsidy at PKR 335 billion for the current fiscal year, The News International reported.
Circular debt occurs when one entity facing problems with its cash inflows does not make payments to its suppliers and creditors, according to The News International.
The IMF has called the revised CDMP "unrealistic", which is made on the basis of certain wrong assumptions. The Pakistan government will have to make changes in its policy prescription to restrict the losses of the power sector, as per The News International report.
The IMF and Pakistan's Ministry of Defence will work out a gap on the fiscal front after which various additional taxation measures will be finalised through the upcoming mini-budget. The revised CDMP has called for an increase in the circular debt to the tune of Rs 952 billion for the current fiscal year against an earlier projection of Rs 1,526 billion. The Pakistan government shared its revised CDMP with the IMF high-ups here on Wednesday.
The Pakistan government's revised CDMP demonstrated that the government needed an additional subsidy of Rs 675 billion despite increasing the power tariff in the range of PKR 7 per unit through quarterly tariff adjustment in the first two quarters of 2023 and PKR 1.64 for the third quarter from June to August.
"The IMF has opposed the certain basis of the revised CDMP and asks the government to raise the tariff in the range of Rs 11 to Rs 12.50 per unit, so that the requirement of additional subsidy could be reduced to half from its existing levels of Rs 675 billion for the current fiscal year," The News International quoted top official sources as saying.
Furthermore, the IMF has raised questions on how the Pakistan government calculated its additional subsidy requirement figure of Rs 675 billion for the current fiscal year, according to The News International report. The revised CDMP envisages restricting losses of DISCOs to 16.27 per cent on average during the current fiscal year.
According to the report, the Pakistan government has envisaged the target to recover Fuel Price Adjustment (FPA) charges deferred last summer to fetch Rs 20 billion against estimates of Rs 65 billion made last summer, as per the news report.
The markup saving due to IPPs stock payment will bring PKR 11 billion and the GST as well as other taxes on a collection basis will help recover PKR 18 billion in the current fiscal year, according to The News International The circular debt is estimated to be around PKR 2,113 billion until the end of Fiscal Year 2023, including the amount parked in the Power Holding Limited (PHL). (ANI)
Get a daily dose of Nigeria Sun news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Nigeria Sun.
More InformationWASHINGTON, DC - Within hours of blocking a UN Security Council resolution from demanding a ceasefire in the current Mideast ...
WASHINGTON D.C.: In a sign of the challenges ahead for his 2024 re-election bid, a new Reuters/Ipsos poll showed that ...
Israel has acknowledged and thanked the United States and President Joe Biden for standing firmly by Israel's side at the ...
NEW YORK: This week, New York City officials said that one person was killed and six others were injured when ...
NEW YORK, New York - The United Kingdom refrained from supporting demands for a ceasefire in the two-months long Israel-Gaza ...
NEW YORK, New York - The U.S. was alone on Friday in a 13-1 vote for a ceasefire in the ...
On December 10, 1948, the United Nations adopted the Universal Declaration of Human Rights in the hope of creating a ...
The ex-British PM is seen by some Tory rebels as being the most formidable opponent to Keir Starmer's Labour, according ...
Durban [South Africa], December 10 (ANI): India's first T20I against South Africa was called off on Sunday at Kingsmead without ...
Nairobi [Kenya], December 10 (ANI): Indian Naval Ship Sumedha arrived at Port Lamu in Kenya on Saturday as part of ...
Dubai [UAE], December 10 (ANI/WAM): James Murombedzi, Senior Climate Governance Expert at the United Nations Economic Commission for Africa (UNECA), ...
Harare [Zimbabwe], December 10 (ANI): Harry Tector who was crowned Man of the Series in their 2-1 T20I series triumph ...