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The IMF demands that Pakistan “increase” gas prices.

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Sources claim that starting in August, the IMF is planning to raise gas prices for the domestic, fertilizer, CNG, and cement industries. Protected and non-protected consumers would see increases ranging from Rs 100 to Rs 400 per month.

Tandoors included, the IMF does not recommend raising the price of gas for commercial users.

According to the sources, three strategies have been presented to the IMF to minimize circular debt in the gas sector. A dividend system has also been discussed as a means of achieving this objective.

Furthermore, the IMF has suggested raising gas prices for plants that fertilize land.

The sources went on to say that there is an understanding reached regarding promptly providing the IMF with data regarding tariffs, reforms, and subsidies.

A tax on monthly pensions over Rs 100,000 was previously sought by the International Monetary Fund mission to Pakistani authorities.

The IMF delegation ‘requested’ Pakistani authorities to raise the general sales tax (GST) to 18% prior to this demand.

The Pakistani sales tax collection system is having issues, according to the IMF mission, since the provinces are collecting sales tax on services while the center is collecting sales tax on commodities.

They recommended the federal government should be the single entity in charge of collecting sales taxes. According to the reports, the foreign lender also insisted on raising the GST rate from 18% to 20% on goods and services.

In the fourth round of negotiations, the mission also required Pakistan to create a new regulatory body and implement reforms in the insurance sector. The fund also called for the sale of three insurance businesses that were held by the government.

The reason the IMF delegation is in Pakistan right now is that Islamabad wants to participate in another program offered by the international lender to help with the funding shortfall.

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In a first for history, PSX crosses the 77,000 milestone.

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At 77,213.31, the benchmark KSE-100 hit an all-time high, up 1,005.15, or 1.32%, from the previous close of 76,208.16.

The government’s readiness to seal an agreement with the International Monetary Fund (IMF) following the budget was cited by analysts as the reason for the upward trend.

Experts anticipate that in an attempt to bolster its position for a fresh bailout agreement with the International Monetary Fund (IMF), the budget for the fiscal year ending in June 2025 would set aggressive fiscal goals.

Budget for Pakistan, 2024–2025
Pakistan’s budget for the fiscal year 2024–25, with a total expenditure of Rs18.877 trillion, was presented on Wednesday by Minister of Finance and Revenue Muhammad Aurangzeb.

The Finance Minister, Muhammad Aurangzeb, outlined the budget highlights. He stated that the GDP growth target for the fiscal year 2024–25 is set at 3.6 percent, while the inflation rate is anticipated to stay at 12 percent.

He stated that while the primary surplus is anticipated to be 1.0 percent of GDP during the review period, the budget deficit to GDP is forecast to be 6.9 percent over the period under review.

According to the minister, tax income collection increased by 38% in the current fiscal year, and the province will receive Rs7,438 billion. The Federal Board of income expects to earn Rs12,970 billion in revenue for the upcoming fiscal year.

In contrast to the federal government’s projected net income of Rs9,119 billion, he stated that the federation’s non-tax revenue projections are set at Rs3,587 billion.

The federal government’s total outlays are projected to be Rs18,877 billion, with interest payments accounting for the remaining Rs9,775 billion.

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Pakistan currently has $14.38 billion in foreign exchange reserves.

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Pakistan’s commercial banks’ reserves, which stood at $5.28 billion at the conclusion of the week ending on June 7, rose by US$174 million, according to a central bank statement.

Reserving US$6.2 million less, the SBP now has US$9.10 billion in reserves. The causes for the decline in the reserves it had were not disclosed by the central bank.

The SBP released a statement that stated, “SBP reserves decreased by US$ 6 million to US$ 9,103.3 million during the week ended on 07-June-2024.”

The State Bank of Pakistan’s (SBP) foreign exchange reserves were reduced by US$ 63 million as a result of repaying external debt, with the reserves standing at US$ 9.093 billion as of earlier on June 6.

The central bank spokesperson said in a statement that as of the week that concluded on May 31, the nation’s total liquid foreign reserves were $14.31 billion.

In terms of net foreign reserves, commercial banks have US$ 5.22 billion of the overall foreign reserves, according to the SBP.

SBP reserves dropped by US$ 63 million to US$ 9,093.7 million during the week that ended on May 24, 2024, according to the announcement.

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In the local market, the price of gold plummets to Rs240,700/tola.

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Gold with a 24-karat purity level has dropped by Rs1200/tola on the local market.

Each tola of 24-karat gold is now selling for Rs240,700, with a further drop of Rs1029 bringing the price of 10 kilos of gold to Rs206,361. These figures are courtesy of the All Sarafa and Jewelers Association.

Meanwhile, after a $2 decline on the global market, one ounce of gold will be valued $2315.

A tola of gold was worth Rs 600 more on Wednesday.

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