Business

Pakistan’s debt at ‘unsustainable’ levels, warns finance minister

Published

8 months ago

Farwa

Dr Shamshad Akhtar says economic revival package on the cards.
Says govt to restructure FBR to increase revenue to GDP ratio.
We are trying to bring a equitable taxation system, says minister.

ISLAMABAD: Caretaker Minister for Finance Dr Shamshad Akhtar while admitting debt had reached “unsustainable” levels shared that the government is in talks with the provinces to shift responsibility for Benazir Income Support Programme (BISP), hand over provincial PSDP projects and close down devolved departments for rationalising expenditures, reported The News on Friday.

“Pakistan’s public debt breached the limits of Fiscal Responsibility and Debt Limitation Act since 2013-14 and it has reached unsustainable levels. There is no good news on the debt burden as multilateral institutions did not permit the restructuring of external debt. The G-20 had granted Debt Service Suspension Initiative (DSSI) during the Covid-19 pandemic. So far Pakistan has undertaken a debt arrangement with China of $2.4 billion till 2024-25,” she said while addressing an SDPI conference in Islamabad on Thursday.

Shamshad addressed all the macroeconomic issues confronting Pakistan and said they were moving towards a democratic transition, and an “economic revival package” was on the cards to achieve self-reliance and ensure integration of the economy with regional countries.

She warned that the debt restructuring talks should be dealt very carefully as it will have repercussions. However, she made it clear that Pakistan does not plan to delay repayments of external debt. The larger fiscal deficit pushed up the debt burden, so the country was forced to breach the Fiscal Responsibility and Debt Limitation Act since 2013-14.

On the domestic debt front, she mentioned the government was moving on the path of re-profiling to move from short-term debt to long-term bonds of 3 to 10 years to reduce the cost of borrowing. However, on external debt, she said options were limited as 44% of overall public debt was in the shape of foreign loans.

Dr Shamshad said the government would restructure the Federal Board of Revenue to increase the revenue-to-GDP ratio from 9 to 15% in the first phase.

“We are trying to place a fair and equitable taxation system,” she said and assured that the tax base would be broadened. The customs policy and operation would be separated with the objective of facilitating trade and eradicate smuggling.

The finance czar said that the GDP growth rate would hover around 2% to 3% in the ongoing fiscal year. She added that the business and investors’ confidence had been restored.

Quoting a WB report, she said Pakistan’s size of economy could touch $2 trillion if the macroeconomic stability was ensured till 2047 from existing levels of $300 billion.

The Viability Gap Fund (VGF) would be established whereby a public-private partnership would be developed to execute development projects with the participation of the private sector. All departments devolved under the 18th Amendment would be abolished at the federal level.

Business

An investigation was “launched” into PTA’s inability to get Rs. 78 billion back from Telcos

Published

17 hours ago

Farwa

The PTA has reportedly been instructed to reply to NAB by July 29. According to the enquiry, the national exchequer has suffered losses as a result of the delay in collecting dues.

The PTA has been asked to provide NAB with information about any pertinent records, court proceedings, and overdue bills. The NAB Karachi has summoned the PTA officials to appear with all pertinent documentation.

All of the principle sum has to be paid by the LDI firms, according to sources. But due to judicial stay orders, the collection of dues has been impeded.

These sources further state that a steering group has been established by the Ministry of IT to supervise the issue of dues recovery.

In a previous event, the tariffs levied on importing cell phones from outside were clarified by the Pakistan Telecommunication Authority (PTA).

Contrary to what some internet reports claim, PTA clarified in response to recent news regarding the tariffs on mobile phone imports that there hasn’t been a formal decision to remove these levies in Pakistan.

the PTA.Pakistanis living abroad will be the only ones free from these levies, according to the PTA. A SIM card can be inserted and the phone restarted to temporarily register a device for non-PTA mobile subscribers.

Business

Weekly inflation in Pakistan increased by 0.17 percent.

Published

17 hours ago

Farwa

The SPI for the week under review in the aforementioned group was reported at 321.95 points, as opposed to 321.40 points during the previous week, according to the PBS statistics.

The SPI for the combined consumption group saw a 20.09 percent increase in the week under review compared to the same week the previous year.

The weekly SPI includes 51 necessary items for every spending group and 17 urban areas, with a base year of 2015–16 = 100.

The SPI for the lowest consumption category, which is up to Rs 17,732, grew by 0.08 percent from 311.97 points to 312.22 points this past week.

0.18 percent,The index of consumption for the lowest consumption groups, which are Rs 17,732-22,888, Rs 22,889-29,517, Rs 29,518-44,175 and above Rs 44,175; increased by 0.13 percent, 0.15 percent, 0.18 and 0.19 percent, respectively.

Nineteen (37.25%) of the fifty-one commodities had price increases over the week, eight (15.69%) had price decreases, and twenty-four (47.06%) had unchanged pricing.

On a weekly basis, the following commodities saw significant price decreases: tomatoes (9.19%), onions (2.14%), LPG (1.04%), bananas (0.53%), wheat flour (0.35%), potatoes (0.17%), pulse masoor (0.16%), and bread (0.05%).

Chicken (4.80%), garlic (2.01%), pulse gramme (1.87%), eggs (1.71%), beef (0.93%), gur (0.89%), pulse moong (0.84%), fresh milk (0.45%), firewood (0.23%), and cigarettes (0.12%) were among the items whose average prices increased significantly week over week.

The commodities that saw a year-over-year decline were: wheat flour (31.75%); cooking oil (13.44%); vegetable ghee 2.5 kg (10.42%); vegetable ghee 1 kg (9.85%); mustard oil (8.33%); eggs (5.82%); rice basmati broken (4.15%); and tea package (2.52%).

Gas prices for Q1 (570.00%), onions (96.01%), pulse gramme (40.39%), powered milk (39.11%), garlic (34.61%), pulse moong (29.77%), men’s sandals (25.01%), beef (23.52%), salt powder (23.28%), pulse mash (22.50%), and energy saver (17.96%) were among the commodities whose average prices increased year over year.

Business

The price of gold has drastically dropped in Pakistan.

Published

2 days ago

Farwa

As per the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the cost of 24-karat gold per tola decreased by Rs 2,300, standing at Rs 250,500.

A kilogramme of 24-karat gold costing Rs1,972 less at the local market, making it worth Rs2114,763. Ten grammes of 22-karat gold had a price decrease to Rs196,866 as well.

After losing a significant $43 during the day, the rate per ounce of gold on the international market also decreased. It currently stands at $2,370.

On Thursday, the price of 24-karat silver also experienced a decline, falling by Rs60 to settle at Rs2,860 petal.