Islamabad: Pakistan’s Prime Minister Shehbaz Sharif has asked his ministers and advisers to travel in economy class, buy luxury cars and give up their salaries as part of an austerity drive that is expected to save the government 200 billion rupees (766 million rupees) a year. dollars) would be saved. The belt-tightening comes as Islamabad – which is facing a balance of payments crisis – strikes a deal with the International Monetary Fund (IMF) to secure $1 billion in funds that will cover last year’s crisis on policy issues. pending since the end. Pakistan’s foreign exchange reserves have fallen below three weeks’ import cover and the spending cuts announced this week are part of an effort to address the economic slowdown.
“These austerity measures will save us Rs 200 billion annually,” Sharif told a news conference in Islamabad.
“These measures are the need of the hour, and these savings do not matter, if it is a penny, it is very important,” he said, terming it a sacrifice for the poor, who cannot afford food or medicines on the table. Can’t pick up Persistently high inflation, which reached 27.5% in January.
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Sharif said all federal ministries and government offices have been instructed to cut spending by 15 percent and asked his ministers and advisers to stop salaries, allowances, luxury cars, foreign trips and business class travel.
Ministers voluntarily agreed to the measures, he said, adding that all cabinet members would have to surrender their salaries and allowances, and pay all their utility bills from their own pockets.
Sharif, without elaborating, said the armed forces have responded positively to the reduction in non-combat expenditure.
Other steps include a complete ban on the purchase of luxury goods or vehicles for all government entities and that no administrative unit, such as a new district or city, will be created for two years.
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All luxury vehicles will be withdrawn from ministers, advisors and bureaucrats, who will travel abroad only when absolutely necessary, and that too in economy class.
Sharif said the South Asian country expected to get funds from the IMF soon, adding the austerity measures were part of the requirements the lender asked Pakistan to meet before finalizing a deal.
Officials say that the talks between Pakistan and the IMF are about to end this week.
Prior to the talks, the IMF had asked Pakistan to take a number of pre-emptive actions, including withdrawing subsidies, increasing energy tariffs, raising additional revenues and arranging external financing.