IMF urges Pakistan to ease trade restrictions

The International Monetary Fund (IMF) has urged Pakistan to ease trade restrictions by reducing tariffs on imported goods, a move the country's economic team has opposed citing concerns over a rising import bill and adverse effect on domestic industries.

Sources told Nukta that during the ongoing talks, the visiting IMF delegation called for the "liberalization of import regime" which involves reducing or removing restrictions on foreign goods by lowering tariffs, eliminating quotas, and simplifying customs procedures.

However, Pakistani officials pushed back against the proposal, arguing that reducing tariffs would not be feasible for the country.

According to the sources, the officials pointed out that developed nations are increasing their trade tariffs, and lowering tariffs at this stage could worsen Pakistan's trade deficit and harm local industries, sources added.

Meanwhile, the Fund has appreciated Pakistan for imposing a substantial levy on gas supply to industrial captive power plants (CPPs), sources said. The move aims to eliminate any cost advantage between grid electricity and in-house power generation by industries.

The levy is part of broader energy sector reforms as Pakistan seeks to address inefficiencies and ensure fair pricing mechanisms.