According to sources, the government is set to decrease petrol prices by Rs14 per litre and diesel prices by Rs10 on May 16 for the next fortnight’s revision.

Last month, the government reduced the price of fuel and high-speed diesel by Rs5.45 and Rs8.42 per fortnight, respectively.

The current fuel price is Rs288.49 per litre, while the HSD price is Rs281.96.

Meanwhile, oil prices fell further on Monday, as signs of sluggish fuel consumption and comments from U.S. Federal Reserve officials dimmed optimism for interest rate reduction, which may slow growth and reduce fuel demand in the world’s largest economy.

Brent crude prices down 25 cents, or 0.3%, to $82.54 a barrel, while US West Texas Intermediate crude futures fell 19 cents, or 0.2%, to $78.07 per barrel.

Oil prices also declined on signals of poor demand, according to ANZ analysts, as gasoline and distillate inventories in the United States increased in the week before the start of the driving season.

Refiners throughout the world are dealing with falling diesel profitability as new refineries increase supply and warm weather in the northern hemisphere and weak economic activity reduce demand.

An initial estimate of Rs 1,500 billion is being given for subsidies, while Rs 9,700 billion is being estimated for interest and loan expenses.

The projection for tax income, according to sources, is more than Rs 11,000 billion, of which Rs 5,300 billion is projected to come from direct taxes and Rs 680 billion from federal excise duties.

Sources predicted that customs duties will bring in over Rs 1,100 billion and sales tax would likely bring in over Rs 3,850 billion.

A fuel charge of Rs 1,100 billion is anticipated to yield the first estimate of non-tax revenue of Rs 2,100 billion. Additionally, reports stated that the estimated government budget deficit is Rs 9,300 billion.

The Pakistani government is expected to remove tax exemptions in the FY2024–25 budget, according to earlier reports, per an IMF demand.

Additionally, tractors and insecticides may see price increases as a result of the government’s proposed sales tax. These are necessary agricultural supplies.

Right now, pesticides and the active substances listed on a registration form filed with the Department of Plant Protection are free from sales tax under the Sixth Schedule of the Sales Tax Act.

Additionally, tractors are exempt from sales tax, including road tractors used to tow semi-trailers. On the other hand, for the next fiscal year, budget managers are talking about eliminating these exemptions and lowering the sales tax rate on pesticides and tractors.

The cost of pesticides and agricultural equipment could rise as a result, which would put a heavy burden on farmers and those who depend on these products.

It is anticipated that the 2019 budget will impose withhold tax on commercial importers, resulting in an additional tax revenue of Rs30 billion.

In order to revive Pakistan’s energy industry, the International Monetary Fund (IMF) called on Islamabad to implement “strong cost-side reforms.”

State Bank of Pakistan (SBP) statistics, which was made public on May 3, shows that the country’s foreign exchange reserves increased significantly to $14.45 billion.

A noteworthy increase of $1.11 billion to $9.12 billion was made in the SBP’s reserves.

The foreign exchange reserves that commercial banks possessed also experienced a notable surge, rising by $2.86 billion to $5.33 billion.

As per the State Bank of Pakistan (SBP), Pakistan got the $3 billion standby arrangement last month, including the much-awaited $1.1 billion final tranche from the International Monetary Fund (IMF).

Following the successful conclusion of the second review by the Executive Board of the IMF under Stand-By Arrangement (SBA),” the SBP stated that it had been awarded Special Drawing Rights (SDR) 828 million, or $1.1 billion in value.

SBP reserves for the week ending on May 3, 2024, will show the payout, according to the central bank.

The second review of Pakistan’s Stand-By Arrangement (SBA) was finished by the IMF Executive Board one day earlier, enabling a $3 billion increase in total disbursements under the contract.

According to a statement from the IMF, “the completion of the second and final review ref­lects the authorities’ stronger policy efforts under the SBA, which have supported the stabilization of the economy and the return of modest growth.”

“Policy and reform efforts by the authorities, including strict adherence to fiscal targets, are necessary to move Pakistan from stabilization to a strong and sustainable recovery,” the statement continued.