IMF Urges Alternative Revenue Sources if Petroleum Levy Is Cut

The International Monetary Fund (IMF) has advised Pakistan to maintain fiscal stability and address the issue of rising circular debt in the energy sector. During a visit to Pakistan, the IMF stressed the importance of sustained measures to strengthen fiscal stability and find alternative sources of revenue if the government decides to reduce the petroleum levy.

Pakistani authorities responded by confirming that structural reforms would continue, even amidst the ongoing Gulf war. They also informed the IMF that higher fuel prices would be absorbed by consumers, while highlighting the introduction of targeted subsidies to assist vulnerable segments of society. The IMF is currently in Pakistan to assess the country's progress under the existing program, with successful completion potentially resulting in financing of up to $1.2 billion. The review encompasses fiscal reforms, energy sector reforms, and revenue measures.