Former President of Islamabad Chamber of Commerce and Industry (ICCI) Dr. Shahid Rasheed Butt on Saturday criticized a cut in the prices of petroleum products that will annoy the IMF and the move is contrary to the ground realities.
The move amounts to challenging the IMF, which will have a minor impact on inflation but will also increase oil consumption, which will increase the burden on depleting foreign exchange reserves, he said.
Shahid Rasheed Butt said that instead of a price cut, the government should have increased the petroleum levy agreed with the IMF.
He said that IMF was already annoyed due to the policies of the government and the latest move will further delay the next IMF loan tranche.
He said that instead of reducing the price of oil for political considerations, the government should have increased its tax revenue and reduced the deficit.
The policymakers should stop playing with the IMF. The country’s economy is on its deathbed and there is no option but to accept the demands of the international organization, he observed.
Mr. Butt said that the country couldn’t afford to be in conflict with this organization. There are continuous violations of promises made to the IMF due to which the ninth review of the IMF is being postponed repeatedly.
Postponement of IMF reviews is bleeding the country’s fragile economy, he said, adding that what is the wisdom of agreeing to the IMF’s terms and conditions every time and then reneging on it?
The IMF wants Pakistan to show fiscal discipline, try to control the deficit, and meet the agreed targets on energy reforms.
It has objected to Pakistan’s exchange rate policy and is demanding a review of it, but it is not being listened to.
Manipulation of data by different governments in Pakistan is not a new thing. That is why the IMF is reassessing Pakistan’s economic outlook after the floods.
