The International Monetary Fund (IMF) has contacted Islamabad, urging it to furnish a detailed document outlining its intentions. It follows the government’s inclination to consult with the Washington-centric financial institution on the proposed mitigation measures to address the escalating electricity prices. This development comes in light of recent widespread public protests in Pakistan opposing the surging costs of electricity.
The national uproar prompted the government, now under the interim leadership of Prime Minister Anwaar-ul-Haq Kakar, to consider engaging with the IMF. The objective behind this dialogue was to secure the institution’s approval before implementing any alleviation strategies to assist citizens grappling with soaring inflation.
On Tuesday, the caretaker prime minister chaired a crucial federal cabinet meeting, addressing potential solutions to the burgeoning crisis. However, the meeting concluded without any firm decisions. The Power Division, during this session, presented several proposals. Yet, getting the IMF’s endorsement first was collectively deemed vital, particularly in light of the stringent conditions accompanying the IMF loans.
It’s noteworthy to mention that Islamabad has committed to maintaining a rigorous financial discipline. This commitment was further solidified when, in July, the country formalized a loan agreement with the IMF worth USD 3 billion. Given this backdrop, any major economic decision, such as altering electricity tariffs, necessitates a balanced approach that considers both the nation’s financial obligations and the well-being of its citizens.