Govt hikes petrol, diesel prices by Rs30 per litre within week

Islamabad: The federal government on Thursday announced another increase in petroleum prices by Rs30 per litre within a week, sending a wave of frustation and anger among the masses. 

Finance Minister Miftah Ismail announced that the federal government had decided to raise the price of petrol by another Rs30, taking it to Rs209 per litre a week after making a similar increase.

The per litre petrol will be available in Rs209.86, diesel Rs204.15, light diesel 178.31 and kerosene oil Rs181.94.

"The government is still facing a loss of around Rs9 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.

The price of kerosene oil has been hiked by Rs26.38 per litre with effect from June 3.

The minister acknowledged that the lower-income segment of society would be affected the most as a result of the petrol price hike, but noted that the rate of oil has also sky-rocketed in the international market.

To a question, Ismail said he was hopeful of reaching an agreement with the IMF in June, but noted that there were some reforms that the government still had to do.

"The IMF wants to see our budget, so the reforms that we want to introduce will be introduced before the budget. However, we are speaking to the IMF on a daily basis," he said.

“I understand that it will further raise inflation, but I want to inform the people that it was inevitable as the government has to make an agreement with the IMF.”

The decisions / steps agreed by former finance minister Shaukat Tarin while striking the deal with IMF and later violating the same had tied the hands of incumbent government, Miftah Ismail said.

The minister announced hike of Rs 30 per liter in the price of petrol, which would now be sold at Rs 209.86 instead of Rs 179.86 from June 3. Likewise, the per liter price of diesel had been enhanced by Rs 30 from Rs 174.15 to Rs 204.15; light diesel oil by Rs 30 from Rs 148.31 to Rs.178.30, and kerosene oil by Rs 26.38 from Rs.155.56 to Rs.181.94.

Despite the price hike, he said, the government was still bearing loss of Rs 9 at per liter petrol, Rs 23 on high speed diesel and Rs 8 at light diesel oil. However, there was no loss on the kerosene oil.

The minister said the hike in petroleum products’ prices would definitely increase inflation, however, the government had taken measures to reduce its negative impacts on the poor people by providing a relief package.

The government, he said, would provide sugar at Rs 70 per kilogram and flour at Rs 40 per kg throughout the year, which would help provide relief to the poor people. The government was already providing subsidy on ghee, rice and pulses, he added.

The minister said China agreed to again give $2.35 billion loan to Pakistan at one percent markup rate, which was less than the previous one.

“We are launching Sasta Petrol and Sasta Diesel cards for those persons, who are earning less than Rs 40,000 per month. They will be able to avail Rs 2,000 per month. This amount will be given to the BISP beneficiaries as well.”

Miftah said that government would continue subsidy on wheat and sugar through the Utility Stores.