Pakistan minister announces subsidy plan amid crisis: 'Taking money from rich, giving it to poor'

Pakistan is going through one of its biggest economic crisis and government has raised taxes and allowed currency to depreciate to meet the IMF’s conditions.

Pakistan’s Finance Minister Ishaq Dar said plans to implement fuel subsidies have been shared with the International Monetary Fund to help alleviate the lender’s concerns before it revives a stalled $6.5 billion bailout.

Pakistan crisis: Pakistan is going through one of its biggest economic crisis in history.(PTI)

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“It’s basically about taking money from rich Pakistanis and giving it to poor ones,” Dar said in a televised statement on Saturday, adding that the subsidies won’t impact the country’s budget. Several meetings have been held in Islamabad with IMF officials this week and many actions to restart the loan program have been completed, he said.

Pakistan is going through one of its biggest economic crisis in history and earlier this week it raised interest rates to an all-time high after consumer prices quickened to a fresh record. The government has raised taxes and energy prices and allowed the currency to depreciate to meet the IMF’s conditions.

The fund is now assessing the proposed fuel discount, which the government plans to fund for lower income groups by raising fuel prices for wealthy motorists, junior finance minister Aisha Ghaus Pasha said earlier this week. Pakistan has missed multiple deadlines in past to revive the IMF program, prompting Moody’s Investors Service to downgrade the nation to its lowest rating last month.

Read here: IMF says Pakistan must complete 'few remaining points' to get $6.5 bn loan

A spokesperson for the IMF didn’t immediately respond to a request for comment on Saturday.