February 16, 2023 (MLN): After witnessing a continuous decline for the last three weeks, the foreign exchange reserves held by the State Bank of Pakistan (SBP) inched up by $276 million to $3.19 billion during the week ended on February 10, 2023, according to the data released by the central bank on Thursday.

Similarly, the country's total reserves rose by $162.6mn or 1.9% WoW to $8.7bn.

On the other hand, the reserves held by commercial banks saw a decrease of $113.6mn or 2% WoW to clock in at $5.5bn.

Last week, the SBP's foreign exchange reserves had dropped by $170mn to a critically low level of $2.92bn, reflecting the urgent need for Pakistan to complete the next review of the International Monetary Fund (IMF) program.

Despite having been valued at nearly $18bn at the beginning of 2022, the central bank's reserves have endured a substantial reduction in the preceding months.

Pakistan is currently facing historic lows in its foreign exchange reserves, which can be attributed to political upheaval and delays in crucial decision-making processes to unlock the IMF deal.

However, the government is currently on its toes to comply with all IMF conditions.

Taking the bold step, the Federal Minister for Finance and Revenue presented the Finance Bill on Wednesday in National Assembly.

As per this, the minister announced several proposed amendments, including an increase in federal excise duty on cigarettes and fizzy drinks, and an increase in federal excise duty on cement from Rs1.5/kg to Rs2/kg. The General Sales Tax (GST) is also increased from 17% to 18%.

The government has also hiked the petroleum prices for the next fortnightly by over Rs22 per litre.

Adding more fuel to the fire, the Oil and Gas Regulatory Authority (OGRA) notified a massive surge in prices by up to 112.3% for domestic users.

These decisions, undoubtedly, were the most difficult decision for the coalition government in the political landscape of Pakistan but much needed to close the deal with the fund.

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Posted on: 2023-02-16T20:16:38+05:00