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Following an IMF-backed tariff cut, car prices are predicted to decline.

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6 days ago

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An agreement has been struck between Pakistan and the International Monetary Fund (IMF) to cut the weighted average tariffs of the nation by half, from the present rate of 10.6 percent to 6 percent over the next five years.

By making Pakistan the nation with the lowest tariffs in South Asia, this calculated effort aims to increase foreign competition in the country’s economy.

The cut is anticipated to directly affect local auto prices, which are predicted to fall due to lower import and associated expenses in the automotive industry.

With the ultimate objective of reaching a 6 percent rate by 2030, the tariff reductions will go into effect in July 2025.

The National Tariff Policy, which seeks to lower tariffs to 7.4 percent by 2030, and the Auto Industry Development and Export Policy (AIDEP), which calls for even more reductions in the automotive sector, will serve as the two main frameworks under which this new policy will be implemented. The tariff will now be set at 7.4 percent, which is little higher than the earlier objective of 7.1 percent, excluding the automobile industry.

Notably, the policy will also result in the removal of various concessions under the fifth schedule of the Customs Act, an 80 percent reduction in regulatory duties, and the total elimination of additional customs duties.

Additionally, beginning in July of this year, a 2 percent duty on zero-tariff slabs and a 7 percent additional customs duty on specific commodities will be eliminated.

The federal government has committed to a 6 percent target, notwithstanding the IMF’s initial proposal to lower the weighted average tariff to 5 percent. Before the end of June, the federal cabinet is anticipated to accept the new tariff policy, which will then be fully implemented in the 2025–2026 budget.

By 2030, all extra customs and regulatory levies pertaining to the automobile industry are expected to be eliminated, with a 20 percent import tariff cap. Significant cuts of 55 to 90 percent will be made to the regulatory duties on automobiles in the first year, with additional reductions to follow in the following years. Along with the steady reduction of current tariffs on various slabs, a new 6 percent customs duty slab will also be created.

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Following’successful’ climate finance negotiations, Pakistan will get $1.3 billion.

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2 days ago

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Julie Kozack, director of communications for the International Monetary Fund (IMF), announced Friday that $1.3 billion would be given to Pakistan as part of climate assistance.

Addressing a press conference, she claimed that talks were held with Pakistan on EFF (Extended Fund Facility) and climate financing. She emphasized that the climate finance negotiations were successful.

In 28 months, $1.3 billion in climate funding will be distributed, she said.

A 37-month EFF program for Pakistan was authorized in September of last year, she said.

According to Ms. Kozack, on March 25, a staff-level agreement was achieved for the fresh loan tranche for Pakistan. Following a successful evaluation process, Pakistan would get a $1 billion EFF tranche.

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Eidul Fitr 2025: PSX observes a week-long holiday in celebration of the festival

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The Pakistan Stock Exchange (PSX) will recommence trading next Thursday following nearly a week-long Eidul Fitr holiday.

Friday typically serves as the final working day of the week at the PSX; nevertheless, the stock trading platform was closed this occasion because to Jumatul Wida.

On Thursday, bullish momentum persisted in the PSX as the benchmark KSE-100 Index hovered at 118,147 after gaining more than 375 points during the early hours.

The day’s minimum was 117,551, after which the market rebounded and ultimately closed at 117,806 points.

Widespread purchasing was noted in essential industries, including commercial banking, fertilisers, power generation, and oil and gas exploration firms.

PEAK LEVEL

On March 21, the PSX resumed its optimal performance by exceeding the 119,000 threshold.

The KSE-100 Index had a peak of 119,405 and a trough of 118,638. The trading activity for the day concluded at 118,442 points.

Previously, the PSX sustained its bullish trajectory, achieving an unprecedented peak of 119,000.

The KSE-100 index increased by 1,330.22 points, reaching a new high of 119,304.24 during intraday trade, reflecting a positive move of 1.13 percent. Subsequently, the principal index concluded the day at 118,769.

FESTIVE ECONOMIC OUTLOOK

Recent market surges have been attributed by analysts to Pakistan’s Staff-Level Agreement with the International Monetary Fund (IMF) regarding the Extended Fund Facility (EFF) and the successful negotiations for a new arrangement under the Resilience and Sustainability Facility (RSF), often referred to as climate debt, which have bolstered investor confidence.

Julie Kozack, Director of Communications at the IMF, revealed on Friday that Pakistan will get $1.3 billion in climate finance.

She stated during a news conference that the discussions on climate money were fruitful, noting that Pakistan would get $1.3 billion within 28 months.

A 37-month Extended Fund Facility programme for Pakistan was agreed in September of the previous year, and the Staff-Level Agreement for the next loan tranche was established on March 25. Pakistan is set to receive a $1 billion disbursement under the Extended Fund Facility (EFF).

Besides, a recent research conducted by the Oil and Gas Development Company (OGDC) and the Pakistan Petroleum Limited (PPL) over the feasibility of the Reko Diq project in Balochistan also sent positive signals to the investors.

Earlier, reports about upgrade of Pakistani banks by Moody’s Ratings and potential resolution of circular debt issue also contributed to investor confidence.

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Pakistan Desires a Sturdy, Long-Term Alliance With Huawei: PM

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According to Prime Minister Muhammad Shehbaz Sharif, the government’s primary objective is to give Pakistani youth technical training in the field of information technology.

The prime minister expressed his desire for a strong and long-term collaboration with Huawei in an interview with a five-member delegation that visited him in Islamabad and was led by Huawei CEO Ethan Sun.

He said the Huawei’s ICT training program will not only increase it exports but will also help youth in getting job opportunities.

The meeting was briefed on the progress made in providing training in the it sector to 300,000 pakistani youth organized by Huawei.

Out of 300,000 youth, 240,000 youth will be provided basic training while 60,000 youth will be provided high-tech training.

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