Govt hikes petrol, diesel prices up to Rs30 per litre

ISLAMABAD: The federal government has surrendered before the International Monetary Fund (IMF) and announced a massive hike in petrol and diesel prices up to Rs30 per litre, ARY News reported on Thursday.

While addressing a press conference today, Finance Minister Miftah Ismail said that the government has decided to increase the prices of petroleum products which will be taken into effect tonight at 12:00 midnight.

The finance minister announced to hike the petrol, diesel, light diesel and kerosene oil prices up to Rs30 per litre.

After the recent hike, the new price of petrol will be Rs179.86 per litre, high-speed diesel (HSD) Rs174.15, kerosene oil Rs155.56 and light diesel Rs148.31 rupees.

Miftah Ismail said that the government is currently giving a subsidy of Rs56 per litre and so far bore Rs55 billion financial loss within 15 days.

He said that Prime Minister Shehbaz Sharif took a tough decision in view of the current economic situation. He added that the government is prioritising the national interests besides blaming the previous government’s policies which rose the inflation rate.

Ismail claimed that the previous government led by Pakistan Tehreek-e-Insaf (PTI) had fixed the petrol and diesel prices. “It is a difficult decision for us to put the financial burden on the nation but it is inevitable. Elite and weak segments are already getting the benefits of petrol subsidy.”

READ: IMF SAYS PREVIOUS PAKISTANI GOVT VIOLATED AGREEMENT BY GIVING SUBSIDY

He clarified that Pakistan could not receive the IMF loan without increasing the prices of petroleum products. The finance minister said that the government will wait for a drop in prices of the petroleum products in the global market, however, it was necessary to pursue loan from the IMF at this time.

Yesterday, it emerged that the negotiations between the Pakistani government and the International Monetary Fund had concluded, and the IMF subjected the $3 billion economic relief program for Pakistan with the removal of fuel subsidies.

The Pakistani delegation had failed to convince the IMF, as both sides could not reach a staff-level agreement despite week-long negotiations in Doha, Qatar, from May 18-25.

According to sources, IMF has refused to issue loans to Pakistan until they remove all subsidies on fuel prices in the country.  The issue of the $3 billion economic relief program to the Pakistani government has been linked to the removal of subsidies over fuel prices.

Pakistan is looking for the release of $3 billion from the IMF. That amount would augment the nation’s foreign-exchange reserves, which at $10.2 billion covers less than two months of imports. The government is staring at a $45 billion trade deficit this year.

The revival was expected to bring stability to the financial markets, the fast-weakening Pakistani rupee, and the depleting foreign exchange reserves, as the government had pinned hopes on the programme’s resumption.