Government dropped petrol bomb on the people as prices of petrol and diesel jacked up Rs 30 per litre

 The decision to increase petrol prices came after IMF refused to resume bailout programme without hike in petrol prices

The coalition government led by PM Shahbaz Sharif dropped petrol bomb on the people of Pakistan who are already struggling due to high inflation. The coalition government announced to hike the petrol prices from 12am mid night today. Rs 30 per litre increase in the prices of petrol; diesel and kerosene oil has been announced.

The new price of petrol is now Rs179.86 per litre, diesel is Rs 174.15 while kerosene oil price is now Rs 155.56 and lite diesel is now Rs 148.31 per litre. These are the highest ever prices of petrol, diesel and kerosene oil in Pakistan. 

The decision to increase the prices of petroleum products came after the refusal of the IMF to restore the $ 6 billion bailout package without increasing the petrol prices.  The decision to increase petrol prices was announced by Finance Minister Miftah Ismail during a press conference today evening.

This decision will further hike the inflation as cost of electricity, transportation and other products will go up. This decision will contribute in the further hike in inflation as cost of living will increase. The government continue to provide subsidies on petrol for nearly six weeks but finally scrummed to the IMF pressure to reduce the subsidies.   

The coalition government left with no other option but to hike the prices of petrol to receive the next tranche of $ one billion from IMF to bring stability in the economy. The finance minister noted some burden was shifted on the masses, but despite the massive increase in the price of petroleum products, the government was still bearing losses. 

Pakistan and the IMF could not reach a staff-level agreement a day earlier after the Fund said there were deviations from the policies that were agreed between both sides.

The PTI-led government had originally agreed to the IMF's demand of raising the price of electricity and petroleum products but, later in March, former Prime Minister Imran Khan announced subsidies on both commodities and the current government was continuing with the same arrangement.

The finance minister noted that following the decision to hike the prices, financial markets would witness stability, the rupee would strengthen, and the economy would get a boost.

In response to a question, Ismail said due to an increase in the price of petroleum products, inflation would definitely witness an increase. "But tell me, what option we had instead of taking this step."

Ismail said Khan going against the IMF deal had announced subsidies on petroleum products when his government's tenure was coming to an end. "We are all the owners of a country. How can we afford [such subsidies] that are costing three times more than running the everyday affairs of the governments," the finance minister said.

The finance minister said it was an injustice to the lower-income segment of the society that the people, who own cars, industries, and generators, are getting subsidies. "Indeed, this is the failure of the government that inflation is rising  but we have provided subsidies on commodities at utility stores and are making sugar available at a lesser cost than Imran Khan's government," he said.

Ismail said increasing the price of petroleum products by Rs30 was not an easy decision for Prime Minister Shehbaz Sharif, but vowed that the incumbent government would take steps to safeguard the economy.

The finance minister stressed that the present government would present the fiscal budget for FY2022-2023 and ruled out the formation of a caretaker government, noting that the current set-up would complete its tenure.

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