Federal Finance Secretary Imdadullah Bosal revealed in Islamabad that under the government’s new austerity campaign, a 50 percent reduction in government vehicle fuel will save only Rs 70 crore over a three-month period, while overall austerity measures are expected to save a total of Rs 16.8 billion. During a briefing to the National Assembly’s Standing Committee on Finance—chaired by Pakistan Peoples Party’s Syed Naveed Qamar on Thursday—he acknowledged that IMF conditions regarding deregulating the sugar sector and expenditures on health and education have not been fully met.
The Finance Secretary detailed that cutting fuel provision for official vehicles by 50 percent will save Rs 70 crore, while a 5 percent reduction in non-salary expenditures for one year will save Rs 16.1 billion. PPP Member of National Assembly Hina Rabbani Khar questioned whether the government’s austerity drive was merely a show, though the Finance Secretary avoided giving a direct response. Briefing the committee as the government’s chief IMF negotiator, Bosal noted that overall implementation of the IMF program has been quite robust.
He stated that three provinces have agreed to deregulate the sugar sector, while talks are ongoing to address the reservations of a fourth province. Per IMF conditions, federal and provincial governments were required to agree on a national policy to deregulate the sugar market by June of this year, encompassing reforms on licensing, price controls, import-export permits, and zoning. However, the government failed to approve the policy within the stipulated timeframe. Implementation of the IMF condition regarding agricultural income tax collection has also faced delays, and the IMF held a meeting with the Sindh government on this matter on Thursday.
