Marriyum Aurangzeb, Federal Minister for Information and Broadcasting, announced on Thursday that the premier has rejected the recommendation by the Oil and Gas Regulatory Authority (OGRA) to increase the price of petroleum products. She added that the incumbent government would not burden the people for the mistakes and the incompetence of the previous government.
وفاقی وزیر اطلاعات مریم اورنگزیب
وزیراعظم شہباز شریف نے پٹرولیم مصنوعات کی قیمتوں میں اضافہ کی سمری مسترد کردی۔ پچھلی حکومت کی نالائقی، نااہلی اور غلطیوں کی سزا عوام کو نہیں دے سکتا۔ مہنگائی کی ستائی عوام پہ مزید بوجھ نہیں ڈال سکتے۔@Marriyum_A pic.twitter.com/e4vd59PO5A
— PTV News (@PTVNewsOfficial) April 28, 2022
This is the second time the Prime Minister has rejected recommendations from the regulatory authority. Before this, PM Sharif rejected the summary which OGRA had sent to the Finance Division. According to the proposal, the OGRA had suggested an increase of Rs. 83.50 per liter of petrol and Rs. 119.88 per liter of diesel (based on the federal government’s advised petroleum levy of Rs30 and 17% GST).
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However, in view of his visit to the International Monetary Fund, soon after the announcement, Miftah Ismail took to Twitter to announce that the government might have to revisit the decision and increase the prices of petroleum products. Nonetheless, the decision not to increase the prices was maintained.
The decision announced last night to continue petrol and diesel subsidies was a tough one and will have to be revisited. At the moment the government is losing Rs 21 per litre on petrol and Rs 52 per litre on diesel. That’s a loss of Rs 3600 crore in 2 weeks 1/n
— Miftah Ismail (@MiftahIsmail) April 16, 2022
On Sunday, after his meeting with the IMF, Miftah announced that an agreement had been negotiated and the IMF was going to extend the loan payments by one year and increase the loan size from $6 billion to $8 billion; however, these “concessions” were not without any preconditions. The IMF demanded steep fiscal adjustments, discontinuation of the amnesty scheme, increase in fuel prices, increase in power tariffs, and restoration of taxes before Pakistan could expect to unlock the loan payments. Analysts argue the government would have to revisit the decision again as the IMF deal is still not closed.
Representatives from both sides are holding technical-level meetings, and the government hopes that once the mission reaches Pakistan in May, a staff-level agreement would be reached.
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