Pakistan has proposed lowering the electricity tariff for its export sector by reducing it from 14 cents to 9 cents, a move shared with the International Monetary Fund (IMF). Despite the IMF’s previous rejection, the government aims to enforce the plan upon the lender’s approval. Additionally, the IMF has revised Pakistan’s 2024 growth estimate to two percent, lower than the government’s target.
ISLAMABAD: Pakistan has shared an electricity tariff plan for the export sector with the International Monetary Fund, ARY News reported, quoting sources.
As per details, the Pakistan government has proposed lowering the power tariff to 9 cents from 14 cents to the export sector. Sources familiar with the development said the plan will be enforced after approval of the international lender.
It is to be noted that the International Monetary Fund (IMF) has once rejected the decision to lower the power tariff for the export sector.
The export sector of Pakistan has been demanding the government to lower the power tariff to boost the exports of the country.
Read more: IMF cuts Pakistan’s 2024 growth estimate to 2pc
Earlier, the International Monetary Fund (IMF) revised down Pakistan’s growth estimate for fiscal year 2024 to two percent – a 0.5pc reduction from October outlook, stated its World Economic Outlook (WEO).
According to the Fund’s World Economic Outlook (WEO) report, Pakistan’s growth estimate was downgraded by 0.5pc from 2.5pc in October’s outlook, expecting a “sluggish pace” of growth in the current fiscal year.
The IMF’s latest growth forecast is lower than the government’s 3.5pc GDP growth target for the current year. However, the Fund predicts a rebound in economic growth for the next fiscal year 2025, projecting a rate of 3.5pc.
Pakistan recently unveiled its plan to revamp its electricity tariff system, aligning it with the International Monetary Fund’s guidelines. This step is part of the country’s ongoing efforts to strengthen its economic policies and maintain financial stability. The proposed changes aim to create a more sustainable and balanced electricity pricing structure, ensuring fair tariffs for consumers while also addressing the challenges faced by the energy sector. By sharing this tariff plan with the IMF, Pakistan has demonstrated its commitment to implementing measures that will result in improved fiscal discipline and energy sector reform. These developments reflect the government’s determination to address key economic issues and pave the way for a more resilient and efficient energy landscape in Pakistan.
Source: ARY NEWS
Summary:
Pakistan has proposed a plan to reduce the power tariff for the export sector from 14 cents to 9 cents, which has been shared with the International Monetary Fund (IMF). This proposal aims to boost the country’s exports by making electricity more affordable for the export industry. The IMF had previously rejected a similar decision, but the government is seeking approval for the revised plan. Additionally, the IMF has revised down Pakistan’s growth estimate for fiscal year 2024 to two percent in its World Economic Outlook report, anticipating a sluggish pace of growth this year, but a rebound to 3.5% in the next fiscal year.
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