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India Gazette
22-05-2025
- Politics
- India Gazette
TN: Sri Lankan Navy allegedly harasses Nagapattinam fishermen in mid-sea
Nagapattinam (Tamil Nadu) [India], May 22 (ANI): Fishermen from Seruthur village in Nagapattinam district of Tamil Nadu have alleged that they have been harassed by the Sri Lankan Navy personnel when they were fishing southeast of Kodiakkarai in a fibre boat. During the incident, Sri Lankan Navy personnel reportedly rammed their vessel into the Indian fishing boat and seized fishing nets worth Rs2.6 lakh, a GPS device, a walkie-talkie, and other equipment. The fishermen alleged that the Sri Lankan naval patrol ship also cut their fishing nets, seized the fuel from their boat, and engaged in a clear act of harassment. Fishermen Shanmugam, Jayaraman, Sakthimayil, and Manimar, who lost their fishing gear and equipment, have since returned to the shore in fear. Tamil Nadu fishermen getting arrested by the Sri Lankan Navy is a recurring instance, for which the State leadership has sought a permanent solution from the Centre, even by retrieving Katchatheevu island, located in Palk Bay, from Sri Lanka. In April this year, the Tamil Nadu Legislative Assembly unanimously adopted a resolution, urging the Union government to take steps to retrieve the Katchatheevu island. The resolution moved by Chief Minister MK Stalin said, 'Retrieval of Katchatheevu island is the only permanent solution to protect the traditional fishing rights of Tamil Nadu fishermen and to mitigate the sufferings faced by them due to the Sri Lankan Navy.' On March 27 this year, the Sri Lankan Navy apprehended 11 Tamil Nadu fishermen and took them to Kangesanthurai Naval camp for investigation, officials said. Earlier on March 20, 13 Tamil Nadu fishermen who were arrested by the Sri Lankan Navy for allegedly fishing outside the approved boundaries returned home to India after being handed over by the Indian Embassy in Colombo. The group of fishermen were arrested on February 26 and was produced in Mallakam court in Sri Lanka, kept imprisoned for nearly a month. Additionally, three fishermen were also admitted to a government hospital in Sri Lanka due to sustaining injuries. The Sri Lankan court reportedly released 13 fishermen on March 12 after talks between the two sides. On February 23, Tamil Nadu Chief Minister MK Stalin expressed concern over the increase in the capture of Indian fishermen by the Sri Lankan Navy, urging the Centre to convene a Joint Working Group (JWG) to find a permanent solution to the issue. (ANI)
Express Tribune
18-05-2025
- Business
- Express Tribune
A crucial milestone in economic stabilisation
Listen to article Pakistan's economy has once again come under the international spotlight following the disbursement of a $1.023 billion tranche by the International Monetary Fund (IMF), part of a larger $7 billion Extended Fund Facility (EFF) aimed at stabilising the country's ailing macroeconomic landscape. With foreign exchange reserves under pressure and fiscal reforms lagging, the IMF programme is both a relief and a significant challenge for Pakistan's policymakers. The $1 billion disbursement, announced by the State Bank of Pakistan (SBP), is expected to bolster the country's foreign currency reserves in the short term. The reserves, which had dipped below $8 billion earlier this year, are vital for ensuring import cover, maintaining currency stability and fostering investor confidence in the economy. With looming external debt repayments and a trade imbalance, the inflow has offered a temporary breathing room. However, it is the IMF's conditionalities that will ultimately determine the long-term trajectory of Pakistan's economy. Among the most significant conditions tied to the EFF are fiscal reforms focused on enhancing domestic revenue mobilisation. Pakistan's tax-to-GDP ratio continues to hover around 9.5%, far below the regional average and insufficient to meet the country's growing public expenditure needs. In comparison, India and Bangladesh maintain tax-to-GDP ratios of approximately 16% and 12%, respectively. The IMF has emphasised the urgent need for Pakistan to broaden its tax base by including previously untaxed or under-taxed sectors such as agriculture, retail and real estate. As part of the new commitments, the government has pledged to increase the tax-to-GDP ratio by at least 1.5% in the current fiscal year and by 3% over the life of the IMF programme. Agricultural income tax reform has been a particular focus as agriculture accounts for nearly 20% of Pakistan's GDP but contributes minimally to tax revenues. The government has agreed to implement progressive tax rates on agricultural income, with rates reaching up to 45% by January 2025. This move has been controversial, particularly among powerful landlords, who have traditionally resisted attempts to formalise and tax the sector. Nevertheless, experts argue that equitable taxation is essential for ensuring both revenue growth and social justice. The energy sector, long a drain on public finances, has also come under IMF scrutiny. Chronic losses in state-owned power distribution companies (DISCOs) due to theft, line losses and inefficiencies have contributed to the ballooning circular debt, which now stands above Rs2.6 trillion. To address this, the government has committed to privatising two DISCOs by early 2025 and phasing out power and gas subsidies, particularly those granted to influential industrial and agricultural groups. Furthermore, provincial governments have pledged not to offer new subsidies and to halt the establishment of additional Special Economic Zones (SEZs) and Export Processing Zones (EPZs), which have historically enjoyed tax exemptions and utility benefits. Removing subsidies and increasing utility tariffs have sparked political backlash, especially among the middle and lower-income segments of society. Electricity prices have already been adjusted upwards multiple times over the past year, with further hikes likely in the near future. Inflation has eroded the purchasing power and led to widespread public discontent. The government faces a delicate balancing act – meeting IMF conditions without triggering a social and political crisis. The IMF programme has also stirred geopolitical tensions. Following the recent loan disbursement, India raised objections, alleging that Pakistan might misuse the funds to support cross-border terrorism, especially in light of a recent militant attack in Kashmir. In response, Prime Minister Shehbaz Sharif rebuffed the allegations, calling them baseless and politically motivated. He emphasised that the IMF's approval was based on Pakistan's fulfillment of stringent economic criteria and that any attempts to derail the programme had failed. These tensions underscore broader regional complexities in which Pakistan's economic recovery is embedded. Despite the challenges, some positive developments have emerged from the IMF agreement. Improved transparency, better fiscal monitoring and the revival of stalled structural reforms are seen as signs of growing policy maturity. The government has also committed to enhancing the autonomy of the State Bank of Pakistan, strengthening anti-corruption institutions and improving the accuracy of budget forecasting and reporting. These measures are critical for restoring the confidence of both domestic and foreign investors, many of whom have remained on the sidelines due to persistent economic uncertainty. The IMF's involvement is likely to unlock additional financing from multilateral lenders such as the World Bank, Asian Development Bank (ADB) and Islamic Development Bank (IsDB). These institutions typically view the IMF approval as a signal of macroeconomic discipline and policy coherence. Already, discussions are underway for the release of additional project-based funding contingent upon Pakistan's progress in meeting IMF benchmarks. This supplementary support will be crucial for financing infrastructure, health care and education projects that might otherwise be sidelined due to fiscal constraints. The path to sustained recovery will depend on the government's ability to implement reforms consistently and inclusively. The private sector, civil society and provincial administrations all have critical roles to play in this process. Without broad-based political consensus and institutional support, even the most well-intentioned reform packages risk faltering. Economic transformation cannot be achieved through donor-driven policies alone; it must be rooted in local ownership and guided by long-term strategic planning. The government must prioritise social protection and inclusive growth to mitigate the impact of austerity measures on vulnerable groups. Expanding the targeted cash transfer programmes like the Benazir Income Support Programme (BISP), investing in education and skills development and supporting small and medium enterprises (SMEs) can help lay a more resilient economic foundation. Only through such comprehensive efforts can Pakistan ensure that stabilisation leads to sustainable prosperity, not just temporary relief. The recent $1 billion IMF disbursement is a welcome development for Pakistan's strained economy, offering both immediate fiscal relief and a framework for structural reform. However, the true test lies in execution. Meeting IMF conditions such as increasing tax revenues, eliminating subsidies and reforming state-owned enterprises will require political will, administrative capacity and public support. With economic resilience hanging in the balance, the stakes have never been higher. The choices made in the coming months will shape not only Pakistan's financial stability but also its social and political trajectory for the years to come. The writer is a member of PEC and has a Master's in Engineering.
Hans India
17-05-2025
- Business
- Hans India
Another RBI dividend booster in sight
Mumbai: Economists expect the Reserve Bank of India's (RBI) dividend to the government to surpass a record over Rs2.5 lakh crore this year as the central bank earnings, through the sale of dollars to prop up the rupee as it sharply depreciated during 2024-25, are reported to have shot up. This higher profit will be transferred to the government as a dividend in 2025-26. The previous record dividend transferred to the government stands at Rs2.1 lakh crore during 2024-25, which helped to keep the fiscal deficit in check, while enabling the Finance Ministry to continue with its expenditure on big ticket infrastructure projects to spur growth and social welfare schemes to uplift the poor. This was a record jump from the Rs87,416 crore transferred to the government in 2023-24 for the profit made in 2022-23. Similarly, the government is expected to get another booster shot through the RBI dividend in the current financial year as well. 'Among the RBI's earnings, forex transactions are expected to be most significant in light of the in light of the central bank's measures to lower rupee volatility by strong dollar purchases earlier in fiscal 2025 and difference in the current versus historical exchange rate. Add to this the interest income on government securities and earnings from funds extended to banks in midst of previous tight liquidity. 'This transfer could amount to a record high at around Rs2.5-2.7 lakh crore this year,' said Radhika Rao, senior economist at DBS Bank. Earnings on forex transactions are expected to be substantial with gross dollar sales tracking at $371.6 billion in fiscal 2025 till February compared to $153 billion in fiscal 2024, according to Gaura Sengupta, chief economist at IDFC First bank. She estimates the RBI dividend to be between Rs2.6 lakh crore to Rs3 lakh crore, according to an NDTV Profit report. The higher dividend creates fiscal space of 0.1 per cent to 0.2 per cent of GDP, estimates Sengupta. With support from the higher-than-budgeted RBI surplus and savings on a few expenditure heads, the central government is in a fairly strong position to counter the growth slowdown risks and any potential emergency spending requirements.
