Hike funding

Pakistani government raises fuel prices sharply to secure IMF financing

The Pakistani government has hiked fuel prices by up to 29%, scrapping fuel subsidies in a bid to reduce the budget deficit and secure critical IMF support for the cash-strapped economy.

This is the third reduction in fuel subsidies by the government led by Prime Minister Shehbaz Sharif in about 20 days.

The new prices took effect from midnight Wednesday and showed a massive hike of Rs 24 per liter in the price of petrol and Rs 59.16 per liter of high speed diesel (HSD) – the two used by everyone directly or indirectly, Finance Minister Miftah Ismail said.

The latest rise came on top of an already Rs 60 rise in oil prices since May 25. The new price of petrol has been set at Rs 233.89 per litre, HSD at Rs 263.31 per liter and kerosene at Rs 211.47 per litre.

He said that the prices of all products had now been reduced to their purchase price and that the element of subsidy or alleged price difference had been eliminated. There is no longer a government loss on the sale of petroleum products, he said, hoping to strike a deal with the International Monetary Fund to restart loan support.

On Thursday, Prime Minister Shehbaz Sharif defended the unpopular moves, saying the government had “no choice” because of “those who struck the worst deal ever” with the IMF.

(Only the title and image of this report may have been edited by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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