COAS Gen Munir calls on PM Shehbaz

ISLAMABAD: Army Chief of Army Staff General Syed Asim Munir called on Prime Minister Shahbaz Sharif at PM office, here on Thursday.

Sources said that both leaders discussed national security issues and overall security situation.

The professional affairs of the Pakistan Army also came under discussion in the meeting.

Sources further said that the economic situation of the country was also mulled in detail.

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on the other hand, the State Bank of Pakistan (SBP)  increased the interest rate by 300 basis points (bps) to 20% to meet one of toughest conditions of the International Monetary Fund (IMF).

The Monetary Policy Committee (MPC), which was supposed to originally meet on March 16, 2023 but it held an emergency meeting to deal with emerging risks to the economy, has decided to raise the policy rate.

It is pertinent to mention here that a record-high inflation number has touched nearby 50-year high of 31.5% in February.

“During the last meeting in January, the committee had highlighted near-term risks to the inflation outlook from external and fiscal adjustments,” the Monetary Policy Statement (MPS) read. It further mentioned that most of these risks have materialised and are partially reflected in the inflation outturns for February.

The national inflation calculated on the basis of the consumer price index (CPI) has surged to 31.5% on an annual basis, while core inflation rose to 17.1% in urban and 21.5% in a rural basket in February 2023.

Meanwhile, the Pakistan rupee plunged by Rs 18.97 against the dollar in the interbank trading on Thursday and closed at Rs 285.08 against the previous day’s closing of Rs 266.11.

According to the Forex Association of Pakistan (FAP), the buying and selling rates of dollars in the open market were recorded at Rs 287 and Rs 289 respectively.

According to currency market pundits, the main concern is the delay in the agreement with IMF, however, the lender’s condition to peg the currency rate with that of the grey market also referred to as the Peshawar market had triggered uncertainty.

They maintained that the current rate was too high and shouldn’t have risen that much, adding that in the grey market, the greenback was trading at Rs290 a day ago.

However, the Government of Pakistan agreed to the IMF demand and imposed a permanent electricity tariff of Rs3.23 per unit to recoup Rs335 billion from consumers, removing another impediment to reaching a staff-level deal.

The Economic Coordination Committee (ECC) of the cabinet, chaired by Finance Minister Ishaq Dar, approved the implementation of an additional surcharge of Rs. 3.39/unit for four months (total surcharge became Rs. 3.82/unit) under peer pressure from the International Monetary Fund (IMF).

As per the details, in the ECC meeting, approval was given to collect Rs 335 billion rupees as a surcharge from electricity consumers during the next fiscal year.