Monday, June 06, 2022
Business Desk

Miftah Ismail rules out imposition of financial emergency in Pakistan

Finance Minister Miftah Ismail says after increasing petrol price twice, Pakistan is out of the "financial crisis"

Business Desk
Finance Minister Miftah Ismail addressing a press conference in Islamabad, on May 26, 2022. — APP
Finance Minister Miftah Ismail addressing a press conference in Islamabad, on May 26, 2022. — APP

  • Miftah Ismail says no possibility of financial emergency in country.
  • He says after two hikes in petrol price, country out of financial crisis.
  • PM Shehbaz Sharif to announce austerity measures as well, he adds.

ISLAMABAD: Finance Minister Miftah Ismail Monday ruled out the possibility of a financial emergency in the country after the government took steps to rectify the ongoing economic turmoil.

In a tweet, Ismail said the country was not facing a financial emergency as the price of petrol had been increased twice — and hiked up to Rs209.86, while there has also been a massive increase in other petroleum products.

The finance minister, without specifying a date, added that Prime Minister Shehbaz Sharif would at some point announce austerity measures to save government expenditure.

In a bid to bring economic stability and revive the stalled multi-billion dollars International Monetary Fund (IMF) programme, the government had increased the price of petrol by a whopping Rs60 per litre.

Moreover, the National Electric Power Regulatory Authority (NEPRA) last week raised the basic power tariff by Rs7.9078/kWh for the next fiscal year 2022-23 — increasing the burden of inflation on the people.

The Oil and Gas Regulatory Authority (OGRA) had also last Friday approved an increase in gas prices — a hike of 45% was approved for the Sui Northern Gas Pipelines Limited (SNGPL) while 44% for the Sui Southern Gas Company (SSGC).

The finance minister had also assured last month that the government would reach a staff-level agreement with the international money lender by June, without specifying the exact date.

Separately, the State Bank of Pakistan (SBP) said the government and the central bank were taking all necessary measures to ensure macroeconomic stability in the country.

The recent difficult decisions taken by the government — including the reduction of subsidies on petroleum products — are expected to pave the way to reaching an agreement with the IMF and release of the tranche and financial assistance from other multilateral agencies and friendly countries.

"We are confident that these measures will relieve the temporary stress being faced due to elevated global commodity prices and geopolitical tensions, and eliminate uncertainty in the economy," the central bank said.

Freezing foreign current accounts?

In another tweet, the finance minister also said there was "absolutely no plan" to freeze foreign currency accounts, Roshan Digital Accounts, or take over people's private lockers.

"We have never even contemplated these steps. Nor will we ever do it. Speculation on social media about this is wrong and coming from biased quarters," he said.

Prior to the finance minister's clarification, the SBP, in a statement, had rebutted rumours of imposing restrictions on foreign currency accounts, Roshan Digital Accounts, and safety deposit lockers.

In a statement, the central bank assured all account holders in Pakistan that their accounts and lockers are completely safe and that there is no proposal under consideration to put any restriction on them.