ISLAMABAD: Finance Minister Miftah Ismail on Thursday announced that the federal government has decided to raise the price of petrol by another Rs30, taking it to Rs209 per litre — a week after making a similar increase.
The new prices will come into effect from midnight tonight.
After the hike, the price of petrol will be at Rs209.86, diesel at Rs204.15, kerosene oil at Rs181.94 and light diesel at Rs178.31.
New price (per litre):
- Petrol — Rs209.86
- Diesel — Rs204.15
- Light diesel — 178.31
- Kerosene oil — Rs181.94
“The government is still facing a loss of around Rs.9 in petrol despite a hike of Rs30 as we are not collecting any tax on the fuel,” the minister told a press conference in Islamabad.
Ismail said the government was holding talks with the International Monetary Fund (IMF) on a daily basis, adding “we cannot accept all their demands but there are certain points that we have to agree to.”
Ismail said the government would ensure the stability in prices of sugar and wheat at Rs70 per kg and Rs40 per kg at utility stores countrywide.
He also said that the government would provide subsidies on rice, ghee, and sugar for the entire year and would not impose new taxes in the upcoming budget, set to be announced on June 10.
But the government needs to withdraw the subsidies, Miftah said.
The finance minister said the government would complete a host of reforms it had agreed with the IMF before presenting the federal budget.
Miftah said that increasing fuel prices was inevitable because the PTI government had signed an agreement with the IMF and it “tied the hands” of the current government.
He said that the removal of fuel subsidies was a “strict condition” from the IMF.
The finance minister said that Pakistan was holding daily talks with the IMF and that the current government would not re-impose taxes on petrol in the month of June but it had to withdraw the subsidies.
He said regardless of the IMF demand to remove fuel subsidies, the Pakistani government could not afford to buy expensive fuel and sell it at a cheaper rate.
Ismail that fuel prices were so low in Pakistan that smuggling of fuel from Iran had stopped.
The finance minister faced tough questions from reporters for, what they said, not taxing the rich or withdrawing petrol allowance for government officers.
He said the withdrawal of such allowance may save Rs4 billion a month but the government was providing Rs4 billion a day in subsidies on fuel.
In response to a question about the power tariff hike approved by Nepra on Thursday, Miftah said that the increased tariff would not apply to electricity bills for the month of June.
The finance minister said that if the people do not pay a higher price for petrol, the rupee would fall drastically, sparking inflation.
