ISLAMABAD: Finance Minister Miftah Ismail Wednesday said that the government has decided to increase the petroleum prices with Rs 24.03 per litre increase in petrol rate and Rs 59.17 per litre raise in diesel price.
New price of petrol would be Rs 233.89, diesel 263.31, kerosene oil would be Rs 211.43 and light diesel Rs 207.47, Miftah said addressing a press conference along with State Minister for Petroleum.
The Finance Minister said that increase was inevitable due to hike in the global market. The government has been facing a loss of Rs 24.03 on petrol Rs 49.16 on diesel, Rs 29.49 on kerosene oil and Rs 29.15 on light diesel.
He said the government has also been facing a loss of Rs 120 billon on petroleum prices monthly. The minister admitted that the increase in petroleum prices would fuel inflation in the country but the government had no other option.
The minister said that 90 lakh poor Pakistanis are being provided Rs 2,000 per month under the BISP and millions additional would also be eligible for Prime Minister’s Relief Package against petroleum prices. He said the allocation of BISP has been increased.
Hike in POL products’ prices on the cards
The previous government had signed agreement with the IMF but violated it in February and the present government soon after assuming the office started negotiations with the Fund but its hands were tied due to agreement of the previous government to increase the prices but also take the petroleum levy to Rs 30 per litre and on top of that Rs 17 percent sales tax.
Besides, Miftah said the international challenging environment of petroleum prices, commodity prices such as wheat and edible oil were also compelling to pass on the price hike to consumers.
He said the international petroleum prices have increased by $20, adding that the agreement with the International Monetary Fund (IMF) would help lessen the problem and gas and electricity prices have not been increased for quite some time and now the rebasing of the electricity prices was approved by the Economic Coordination Committee (ECC) of the Cabinet.
“We are taking difficult decisions,” Miftah maintained.
According to Finance Division's late-night statement, in the wake of rising petroleum product prices in the international market and exchange rate variation, maintaining the fuel prices at the subsidized rate is constantly increasing the fiscal deficit and current account gap besides putting pressure on country’s foreign exchange reserves.
Therefore, the Government has decided to consider the proposal of OGRA to increase the petroleum products prices. However, Petroleum Levy and Sales Tax have been kept at zero to provide relief to the end consumers.
New prices of petroleum products with effect from 16 June, 2022.
Copyright Business Recorder, 2022