Pakistan authorities on Wednesday determined to impose a ban on the import of non-essential and luxurious gadgets because the cash-strapped nation tried to avert a monetary meltdown amid depleting overseas reserves, based on a media report.
Quoting sources, Geo News reported that Prime Minister Shehbaz Sharif has imposed a ban on the import of non-essential gadgets that aren’t utilized by the widespread man. The resolution is claimed to be necessary to regulate the greenback flight, it stated.
The sources stated that the prime minister has banned the import of luxurious automobiles and different non-essential gadgets, together with cosmetics, for which directions have additionally been issued.
They additional added that the choice was taken because of the widening commerce deficit and, after holding a consultative assembly along with his coalition companions, Prime Minister Shehbaz determined that the federal government will take powerful selections to stabilise the ailing economic system.
The US greenback has witnessed a file surge throughout the previous few weeks and was being traded right now at over Rs 200 within the open market, signalling a insecurity among the many merchants within the monetary markets, the report stated.
According to sources within the Federal Board of Revenue (FBR), a proposal to extend obligation on some gadgets has been submitted.
Under this, regulatory obligation on equipment will likely be up by 10 per cent and residential home equipment by 50 per cent. Duty on automobiles above 1,000cc will likely be hiked by 100 per cent. Duty on cellphones may also go up between Rs 6,000 to Rs 44,000 per unit, the report stated.
The curbs on non-essential imports got here as Pakistani officers and the representatives of the International Monetary Fund have commenced talks in Doha on Wednesday for revival of the stalled USD 6 billion Extended Fund Facility (EFF) programme.
Its revival has been termed essential for Pakistan’s cash-strapped economic system, which has seen its overseas trade reserves plummet in latest weeks amid import funds and debt servicing, the Business Recorder newspaper reported.
Foreign trade reserves held by Pakistan’s central financial institution decreased one other USD 190 million to USD 10.31 billion final week, lowest since June 2020, with the extent staying at lower than 1.5 months of import cowl, the report stated.
With the greenback rising to uncharted heights, stakeholders warn {that a} weakening rupee may open up Pakistanis to a second spherical of inflationary impression, which is able to hit the decrease and center courses the toughest.
Experts advised the Dawn newspaper that whereas no sector of the economic system can be resistant to the fallout from the rupee’s steep devaluation, key areas resembling debt servicing and imports for trade and meals gadgets will likely be among the many first to be affected.
The rising oil costs have already doubled the oil import payments, however the total imports are additionally at a file excessive. In April, imports elevated by 72 per cent, leaving no room for the federal government to enhance its exterior stability.
