![](https://nation.com.pk/print_images/large/2021-10-02/finance-minister-defends-fuel-price-hike-claims-lowest-in-pakistan-1633138733-7286.jpg)
ISLAMABAD – After increasing the petrol price to highest record level in the country’s history (Rs127.3 per litre), the federal government on Friday claimed that oil prices are still lowest in Pakistan as compared to that in other countries in the region.
“Prices in the international market have increased recently forcing the government to hike local prices,” Federal Minister for Finance and Revenue Shaukat Tarin said while addressing a press conference along with Minister of State for Information and Broadcasting Farrukh Habib here.
He informed the media that the government did not pass on the full impact of increasing international oil prices to the masses. “We have passed on minimum increase in the prices to the consumers”. The government has absorbed the pressure of hike in prices in international market by bearing the burden of Rs2 billion. He said the global oil price hike caused by Covid-19 has impacted Pakistan as well.
Pakistan stands at 17th position in respect of oil prices in the world, and the countries where prices are lower than in Pakistan themselves produce oil, he added. He said that petrol is being sold at Rs127 per liter in Pakistan whereas its price in India was Rs235 per liter and Rs195 per liter in Bangladesh.
He informed that the government had projected to generate Rs600 billion from the petroleum levy during the current fiscal year. However, Prime Minister Imran Khan had directed to provide maximum relief to people in oil prices, which resulted in lesser collection in petroleum levy. He said that the government had slashed the petroleum development levy from Rs30 in 2018 to just Rs2.5 per liter.
The government is facing severe criticism from people, business community and opposition parties after increasing almost all the petroleum products 0n Thursday. The government has increased petrol by Rs 4 per litre, High Speed Diesel (HSD) by Rs 2 per litre, kerosene oil by Rs 7.05 per litre and Light Diesel Oil (LDO) by Rs 8.82 per litre for the first fortnightly of October.
The Finance Minister once again blamed international market responsible for increasing inflation rate in the country. The entire world has witnessed food inflation due to Covid-19, and being a food importer, Pakistan also had to face this impact. Agriculture sector was neglected in last 30 years by different governments. He shared that the government has decided to reduce the prices of flour to Rs1100 per 20 kg bag, ghee and oil prices by Rs50 per kg and fixing sugar price at Rs90 per kg in the country. Meanwhile, the government would provide direct cash subsidy to 12.5 million families, which would cover 40 to 44 percent of the population of the country.
He said agriculture is also being focused to grow food items locally to meet the demands.
Shaukat Tarin said that Pakistan’s economy is growing as tax collection target is surpassed by Rs185 billion to Rs190 billion in first quarter (July to September) of the current fiscal year and imports are enhancing. Tax collection is showing growth of 38 to 40 percent. He was optimistic that the government would achieve the annual tax collection target.
The Finance Minister said that the government would soon launch Kamyab Pakistan Programme after addressing the concerns of International Monetary Fund (IMF) and World Bank. Under the Kamyab Pakistan Programme, the government would provide loan to agriculture, industrial, and housing sectors besides providing health cards and technical training to the youth. He said that Prime Minister Imran Khan wants to make Pakistan as Riyasat-e-Madina-like state.
He admitted that loan is increasing due to the currency depreciation. However, debt to GDP has declined by 4 percent in the last fiscal year. Talking about the IMF programme, he said that the government is taking a big comprehensive plan to the IMF. “I hope we will be heard in the IMF. We will have talks on revenue and the power sector.”
Noting that the revenue collection has increased up to 40%, he admitted that there are challenges in the power sector. “Increasing power tariff is not the solution,” he said.
Farrukh Habib said provincial governments also have responsibility to control prices of essential commodities. He said the Punjab government is performing well in this regard. He said the prices of wheat and flour in Sindh are higher than that in Punjab. He said the government is working on food security.
He further said that ten dams are being constructed that will add affordable energy to the national grid. He said the government is striving to ensure that minimum impact of international prices is passed on to people. He said sales tax and petroleum levy have been gradually reduced to lower burden on consumers.
Meanwhile, Minister for Finance and Revenue Shaukat Tarin Friday said that Saudi Arabia had agreed to provide US$3.6 billion for purchase of crude oil. Saudi Arabia would pay $3.6 billion to government of Pakistan on monthly basis over a period of two years, Shaukat Tarin said while talking to media in Jhelum.
He said the government of Pakistan would receive $150 million per month that would be utilized only for the oil purchase.