Pakistan Will Default if Subsidies are not abolished

Muhammad Usman Jumani
Miniister of Finance Miftah Ismail

Minister of Finance Miftah Ismail on Monday warned, if the government does not put an end to the subsidies on petroleum, Pakistan will default.

The finance minister also said that the International Monetary Fund (IMF) has insisted to put an end to the subsidies on petroleum products.

Government of Pakistan in a attempt to bring economic stability and to resurge the mired multi-billion-dollar IMF program, had increased the price of petrol by a massive Rs.60 per liter last month.

Minister of Finance Miftah Ismail Warning

Miftah Ismail has also warned that if government does not increase the petrol price, IMF will not be willing to strike a deal with the country, and he also threatened if that happens then the country could be heading towards destruction.

It was anticipate that after the budget, some obstacles would be remove in IMF’s program.

But Miftah Ismail said something contradictory last week, he said that International Monetary Fund (IMF) was still discontented with the government over the budget, as the Personal Income Tax (PIT) was not implemented as it was suggested by the IMF.

Miftah, also said that he has told the Prime Minister that we have to take tough decisions. The Prime Minister is unhappy with rising the prices of petroleum products, and the ministers curse whenever I send them a summary in this regard.

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Miftah Ismail the Finance Minister of the country said that the government was still subsidizing Rs 19 on petrol and Rs 53 on high-speed diesel, he also said that the Sri Lanka before defaulting gave subsidies to its public and it eventually defaulted.

The Finance Minister quoting the ongoing situation of Sri Lanka said that, today, Sri Lanka is buying expensive oil and have no funds to buy medicines for their public, and a similar situation could appear in Pakistan, he warned.

Miftah Ismail also hinted at another increase in the petrol prices in the coming month of July by saying if these subsidies are not abolis the country will default.