Government takes inevitable decision and raises oil prices to strike IMF deal: Miftah Ismail


Federal Finance and Revenue Minister Miftah Ismail on Thursday announced an increase in petroleum products in accordance with the agreement signed by the previous government with the International Monetary Fund (IMF).

ISLAMABAD, (UrduPoint/Pakistan Point News – June 2, 2022): Federal Finance and Revenue Minister Miftah Ismail on Thursday announced an increase in petroleum products in line with the agreement signed by the previous government with the International Monetary Fund ( IMF).

Addressing a press conference, the minister said it was an inevitable move as the government was also incurring a loss of around Rs 91 billion due to the provision of subsidies on petroleum products based on May 31 rates. As oil prices had further increased in the international market since May 31, the loss would amount to around Rs 130 billion and would further burden the national treasury.

“I understand that this will further increase inflation, but I want to inform people that it was unavoidable because the government has to reach an agreement with the IMF.” The decisions/steps agreed upon by former Finance Minister Shaukat Tarin in reaching the IMF deal and its subsequent breach tied the hands of the incumbent government, Miftah Ismail said.

The minister announced an increase of Rs 30 per liter in the price of gasoline, which would now be sold at Rs 209.86 instead of Rs 179.86 from June 3. 204.15; light diesel of Rs 30 from Rs 148.31 to Rs.178.30, and kerosene of Rs 26.38 from Rs.155.56 to Rs.181.94.

Despite the rise in prices, he said, the government still suffered a loss of Rs 9 per liter of petrol, Rs 23 on high-speed diesel and Rs 8 on light diesel. However, there was no loss on kerosene oil.

The minister said that rising prices of petroleum products would certainly increase inflation, however, the government had taken steps to reduce its negative impacts on the poor by providing a relief package.

The government, he said, would provide sugar at 70 rupees per kilogram and flour at 40 rupees per kg throughout the year, which would help relieve the poor. The government was already subsidizing ghee, rice and pulses, he added.

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