Pakistan withstands energy price shock, but Gulf infrastructure attacks pose economic risks: Finance Minister

According to Profit, citing an interview with Agence France-Presse, Finance Minister Muhammad Aurangzeb said Pakistan has enough energy supplies through November. Speaking in Bangkok at IMF and World Bank gatherings, he added that winter demand is now the focus of preparations. However, he warned that attacks on energy sites in Saudi Arabia and across the Gulf could weigh on the longer-term economic outlook.

Aurangzeb said Pakistan has steered clear of fuel shortages, long queues at pumps and public order problems, and it will avoid costly spot LNG cargoes unless necessary, relying on existing supply deals. Oil and gas prices have climbed since the US and Israel began military action against Iran in February. Houthi attacks on Saudi energy sites have added to doubts about how long the crisis will last.

He said Pakistan was already on a fiscal consolidation path, one the Fund has pressed governments to keep up, while vested interests and lobby groups resist structural reform. He added that tax revenues have risen significantly in recent years, and that authorities are now acting against firms that keep sales tax collected from customers instead of depositing it. Pakistan is implementing a $7 billion IMF Extended Fund Facility alongside a $1.4 billion Resilience and Sustainability Facility. Earlier this month a staff-level agreement was reached that could release about $1.2 billion, subject to Fund approval.