Crisis-hit Pakistan's situation continues to worsen with each passing day. The Pakistan Bureau of Statistics data reveals that the country has hit a new high in inflations based on the sensitive price indicator as it reached 47 per cent year on year in the week ended on March 22.
Hike in essential commodity prices
This comes after Pakistan's continuous price hike for essential commodities. In total the prices of 26 items have been increased whereas 13 items remained unchanged.
The price of onions went up by 228.28 per cent, wheat flour prices saw a hike of 120.66 per cent, tea lipton prices were hiked by 94.60 per cent, bananas cost were raised by 89.84 per cent and the price of eggs were increased by 79.56 per cent revealed a report by pkrevenue. Even the cost of diesel and petrol was increased by 81.17 per cent and 102.84 per cent respectively. While the gas charges for Q1 saw a rise of 120.66 per cent, the price hike for cigarettes was at 165.88 per cent.
Pakistan's foreign exchange reserves
The report also stated that Pakistan's foreign exchange reserves were increased to $10.14 billion for the week ending on March 17. The country is currently struggling with a shortage of forex reserves to sustain its balance of payments due to the International Monetary Fund (IMF) loan delay and economic crisis.
IMF and Pakistan negotiations
The IMF and Pakistan have been negotiating since early February to finalise an agreement for the release of $1.1 billion, which at this point is very important for the country.
The government of Pakistan has made numerous changes including the hike in fuel prices, increasing taxes and other similar demands made by the financial body for loans. The funds that are expected to be released are part of a $6.5 billion bailout package the loan body approved in 2019. This fund is very important to Pakistan in order to prevent any defaults on external payment obligations.
However, despite the negotiations since last month the country is yet to be granted any funding.
According to the report by pkrevenue, IMF has asked Islamabad to offer external financing assurance before it can release the bailout funds. It wants Pakistan to get the assurance of up to $7 billion to fund the balance payment gap of this fiscal year. Pakistan's Finance Minister said that this number should be less and close to $ 5 billion.
