Business
Inflation likely to remain at 18.5% in Pakistan, IMF
The report added that the delay in funding by financial institutions may put pressure on the value of the rupee.
The International Monetary Fund (IMF) report on Pakistan's economy has been released which stated that inflation in Pakistan is expected to remain at the rate of 18.5 percent, while the rate of inflation in rural areas may reach 25.9 percent.
According to the IMF report, the pressure of external payments on Pakistan will not end immediately, it will remain for a few years.
The IMF report said that the current account deficit would remain at 1.6 percent of the economy, delaying funding by financial institutions could hurt the economy.
The report added that the delay in funding by financial institutions may put pressure on the value of the rupee, and Pakistani people will also be affected by the increase in the cost of food and beverages in the global market.
According to the IMF report, there will be no increase for government employees and pensioners till June, the development budget will be cut by 61 billion rupees.
In the report, the IMF added that National Electric Power Regulatory Authority (NEPRA) will issue a timely notification in determining the power tariff.
IMF further said in the report that Oil and Gas Regulatory Authority (OGRA) will issue the notification for increasing gas rates on time, the half-yearly increase in gas rates will be done on time.
The report stated that Pakistan needs external financing of 71.88 billion dollars in the next 3 years, while external funding of $24.96 billion is required in the current financial year alone.
According to the IMF document, 22.24 billion dollars will be needed in 2025 and $24.67 billion in 2026.
In the report, the IMF said that the amount of debt owed by Pakistan is unsustainable and the external risks are high. To deal with the challenge, heavy financing will be required from international financial institutions and various countries.
The IMF has also stated that the Government of Pakistan has assured them of external financing arrangements.