Author: Khaleeq Kiani
Khaleeq Kiani is a Dawn newspaper journalist and contributor, covering mainly local news from Pakistan and Asia.
Major Changes Unveiled in Finance Bill for 2024-25 The federal budget for the upcoming year has undergone significant revisions, with Finance Minister Muhammad Aurangzeb announcing key amendments to the proposed finance bill for 2024-25. The changes include zero rating on local sales of export industries, stationery items, and continued reduced rates for hybrid electric vehicles. The government is also considering stricter measures for retailers and distributors outside the tax net. Prime Minister Shehbaz Sharif confirmed that the budget was prepared in collaboration with the International Monetary Fund (IMF). He expressed hope for a positive response from the lender, emphasizing the…
Government Highlights Fiscal Risks in Annual Budget Planning The government’s finance team has identified nearly a dozen critical risks that could impact next year’s budget and medium-term outlook. These risks include higher interest rates, currency depreciation, greater subsidy requirements, and challenges in achieving revenue targets. Climate change has been listed as one of the significant challenges that need to be addressed. The Ministry of Finance has called for comprehensive measures to tackle these fiscal challenges. The combination of risks such as higher interest rates, lower revenue collection, and increased subsidies could have a substantial impact on fiscal variables. The government…
In a recent announcement, the National Electric Power Regulatory Authority (Nepra) revealed a significant increase of almost 20% in the uniform national tariff to secure approximately Rs3.8 trillion in funding for the 10 ex-Wapda electricity distribution companies (Discos) for the fiscal year 2024-25. This adjustment, resulting in a Rs5.72 per unit increase, aims to generate an additional revenue of Rs485 billion for Discos and strengthen the government’s position in securing an IMF bailout in July. The average national base tariff is set to reach Rs35.50 per unit, with additional taxes and surcharges pushing it up to Rs42 per unit, thus…
The government is set to reduce petrol and high-speed diesel prices in line with the recent decline in international prices. Petrol is expected to drop by Rs9 per litre and HSD by Rs5 per litre in the upcoming review on June 15. The international market saw a decrease of $3.75 and $2.7 per barrel for petrol and HSD, respectively, over the last two weeks. Despite the decrease in prices, the government has already maximized the Petroleum Development Levy (PDL) at Rs60 per litre, contributing Rs720bn to the treasury. However, the budget target for PDL collection has been revised to Rs960bn…
Summary: The National Economic Council (NEC) approved an indicative national development plan worth Rs3.792 trillion for the next fiscal year, aiming to boost economic growth to 3.6% from the current 2.4%. The federal Public Sector Development Programme (PSDP) was increased by more than 47% to Rs1.4 trillion, along with additional investments in public-private partnership (PPP) projects and state-owned entities. Provincial demands for development projects were met, resulting in a total allocation of Rs2.095 trillion for provincial annual development plans. The NEC decision to continue funding ongoing provincial projects addressed concerns raised by chief ministers of all four provinces, focusing on…
The Oil Industry Protests Pakistan Railways’ Tender Specifications The oil industry is voicing its concerns over Pakistan Railways’ tender specifications that favor imported high-speed diesel (HSD) over locally produced HSD. Adil Khattak, chairman of the Oil Companies Advisory Council (OCAC), has raised the issue with the government, highlighting the impact on local refineries. The tender requires a minimum flash point of 66 degrees Celsius, which aligns with imported HSD standards but not with locally produced HSD, which has a minimum flash point of 54 degrees Celsius. This discrepancy means that Pakistan Railways cannot use locally produced diesel, leading to a…
The National Economic Council (NEC), led by Prime Minister Shehbaz Sharif, is set to convene to review ongoing and future investments and set targets for the next fiscal year, aiming for a 3.6% economic growth rate. The council will consider the 13th five-year plan, review the performance of Ecnec and CDWP, and push to increase the federal Public Sector Development Programme (PSDP) to Rs1.5 trillion, against the Rs1.22 trillion recommended by the APCC. The meeting will review the outcome of the 2023-24 macroeconomic framework, approve next year’s economic priorities, and consider the national investment plan for the next fiscal year.…
The National Electric Power Regulatory Authority (Nepra) has approved an additional fuel cost of Rs3.33 per unit for April consumption, allowing ex-Wapda distribution companies to raise Rs29 billion in June. This adjustment will result in a net tariff increase of about Rs6 per unit due to its impact on quarterly tariff adjustments. It will apply to all consumer categories except Electric Vehicle Charging Stations and lifeline consumers. Nepra’s determination also highlighted the minimal impact of solar net metering on electricity sales, with only 1.15% of total grid supply coming from net metering units in April. This challenges the narrative against…
Federal Budget Announcement for 2024-25 in Limbo The announcement of the federal budget for 2024-25 is facing delays, with key components like the National Economic Council (NEC) meeting and Budget Strategy Paper not yet scheduled or shared, raising doubts about its presentation in parliament on June 10. Prime Minister Shehbaz Sharif and Finance Minister Muhammad Aurangzeb are unavailable until June 8, disrupting key consultations. The NEC meeting is crucial for reviewing the current economic situation and development agenda but is yet to be constituted. The Annual Plan Coordination Committee (APCC) meeting continues amid differences, while the Planning Minister was reportedly…
Exciting News! Monthly inflation in Pakistan has dropped below 12% — the lowest in 30 months, leading to projections of an immediate cut in the State Bank of Pakistan policy rate. S&P Global expects a cumulative 450 basis points reduction by the end of 2024 from the existing peak of 22%. The recent decline in headline inflation has increased the likelihood of a policy rate cut by the SBP in June 2024. S&P Global Market Intelligence forecasts a total reduction of 450 basis points in the policy rate by the end of the year. The positive numbers are attributed to…