Pakistan’s Petrol and Diesel Prices Reach Record High Amid Economic Crisis
Inflation-hit The government has established a new high for the price of gasoline and diesel, dealing Pakistan another blow as its people already struggle with rising expenses for basic necessities. The Shehbaz Sharif administration recently proposed raising the goods and services tax to 18% in the Pakistan National Assembly in order to earn PKR 170 billion in revenue to assist alleviate the country’s economic difficulties.
Geo TV reported that the cost of gasoline has jumped by PKR 22.20, reaching a new high of PKR 272 a litre. Kerosene oil will now cost PKR 202.73 per litre, according to the Pakistan Finance Division, while light diesel oil would cost PKR 196.68 per litre. One of the requirements of the International Monetary Fund (IMF) was the increase in oil costs, which will lead to an increase in inflation.
The prices of everyday usage commodities have already soared with milk costing PKR 210 per litre and chicken meat being offered at PKR 780 per kg. The country, which has been struggling with high inflation for some time, is likely to experience additional inflationary pressure as a result of this spike in oil prices.
A senior economist from Moody’s Analytics predicted on Wednesday that inflation in Pakistan would peak at 33% in the first half of this year before declining. Furthermore, the IMF rescue is unlikely to restart the economy. “In our opinion, a rescue from the IMF won’t be sufficient to restart the economy. Economic management that is persistent and sound is what the economy actually needs “Katrina Ell, a senior economist, told Reuters.
Islamabad has held talks with the IMF for the release of bailout funds as it has reserves to meet only three weeks of imports. The supplementary bill moved in Pakistan Assembly by finance minister Ishaq Dar proposed exemption of GST from daily use items like wheat, rice, milk, and meat to reduce the impact of the budget. The finance bill proposed raising taxes on luxury items to 25 per cent, besides raising taxes on first and business-class air travel, sugary drinks, and cigarettes. The Shehbaz Sharif regime has also proposed a withholding tax on marriage halls and events at ten per cent, according to Reuters.
Opposition parties have sharply criticised the government’s decision to raise petrol prices, charging it with being indifferent to the condition of the average person. Shehbaz Sharif, the leader of the Pakistan Muslim League-Nawaz (PML-N), also disapproved of the action, claiming that it will burden the populace more.
The hike in fuel prices has also been met with protests from transporters and commuters, who have requested an immediate rollback of the costs. The Pakistan People’s Party (PPP) has also denounced the action, claiming that it will make the challenges faced by the average person much worse.