Discussions with the World Bank are ongoing to bring US$2bn on a fast track basis

  • The agriculture sector is expected to improve, with positive growth projected from major and minor crops.
  • SBP’s decision to maintain the policy rate at 22% will keep the cost of borrowing low.
  • Discussions with the World Bank are ongoing to bring US$2bn on a fast track basis.
  • The government is also working to attract Foreign Direct Investment (FDI) to the country.
  • Dollar against PKR is down due to a crackdown against exchange companies without any intervention by the government or the State Bank (SBP).
  • A crackdown against electricity theft is ongoing. So far, the Government has received a positive response which includes improvement in billing and recovery.
  • Work on the change of the board of DISCOS (Distribution Companies) is also currently in progress.
  • The government’s focus is to minimise the burden of high electricity prices on consumers as much as possible.
  • The total power circular debt is Rs2.5trn, and the gas circular debt is Rs2.9trn, bringing the total circular debt to Rs5.4trn. The government pays Rs1trn in interest payments on this circular debt.
  • Currently, Exploration and Production (E&P) companies are extracting less oil and gas than they did ten years ago, despite the identification of new reserves and fields. To address this issue, the government is working to attract foreign investors to the exploration sector.
  • A plan for gas load shedding is currently being developed with a focus on reducing gas shortages during the winter months
  • In the national interest, the FBR revenue target must be met at any cost, as Pakistan cannot afford low revenue.
  • Action announced by SBP on exchange companies is to consolidate exchange companies.
  • SIFC is a transparent and very effective form of civil and military cooperation.
  • The impact of recent rupee appreciation against US dollar on petrol prices will become visible in the next months fuel prices.
  • Finance Ministry will review the Public Sector Development Program (PSDP) with the Planning Ministry, and disbursement may change towards effective projects.
  • The process of increasing gas rates is underway, and the rising gas circular debt can be attributed to distortions in the pricing structure. Government is importing gas at Rs3,700 and selling it at Rs1,100, which is a significant contributing factor to the accumulation of circular debt.
  • Minister highlighted that the average daily loss on gas is Rs1bn.
  • It is not the right time to change the returns of CPEC IPPs, as we did in the past with local IPPs. Currently, we should focus on increasing the tenure of foreign debt to reduce capacity payments.
  • In order to broaden the tax net, the government needs to (1) amend tax laws to include the retail segment and others to tax net, (2) strengthen the FBR, and (3) promote the documentation of the economy, as a significant portion of the economy is currently undocumented.
  • On today’s Supreme Court decision, the government will wait for the detailed verdict. After discussions with the Law Ministry, it will then take appropriate action.
  • Funds have already been allocated for the elections in the FY24 budget. Wherever the Election Commission needs any assistance, either monetary or non-monetary, the government will provide it.
  • Courtesy- Topline Pakistan Research
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