The recent record increase in prices of petroleum products has drawn stern reaction from people who see it as another factor to cause price-hike in the coming days. The Oil and Gas Regulatory Authority (OGRA) on Saturday increased prices of petroleum products. The price of petrol has increased by Rs 8.02 making the per liter price Rs105.68. The price of diesel has also been raised by a staggering Rs 4.70 per liter to making it Rs108.16 per liter. There was no relief for consumers as the price of CNG was also hiked by Rs 11.58 per kg.
People said the government was not caring enough for problems of a common man. They said instead of increasing petroleum prices, the government should have cut its own expenditure through austerity.
They said the country’s poor and destitute masses who have braved a reduction in their purchasing power parity by 65 percent in the last four years because of stagnation in the GDP growth will be exposed to more vulnerability. On account of the tremendous pressure, the middle class is also facing incessant double digit inflation and thus it is being pushed to the lower middle class.
Arshad Malik, a government employee, said unprecedented price increase would affect quality of common man’s life as the cost of production in agriculture, transport and industry sectors would go up.
He complained that wheat flour, vegetables, beef, chicken, sugar were being sold at ‘revised rates’ and the transporters were overcharging by presenting excuses that petrol prices had increased.
With the increase, the government is likely to pocket Rs 25 billion in the month of April in the form of heads of GST and petroleum levy, according to an FBR official. “On account of GST, the government will earn Rs 18 billion and Rs 7 billion because of the petroleum levy,” people said showing their fury.
They said: “As compared to the month of March, the government will have an additional Rs1.5 billion revenue as more GST will be collected because of a hike in POL prices, so much so that the government will earn Rs 27 billion gas development surcharges in the month of April.”
Muhammad Aftab, working in a private organisation, said the government increased pay of its employees but its trickle-down impact was yet to be registered. Tahir Saleem, another employee, said the price hike in POL products would result in increase in daily problems. He said it seemed the government was trying to kill the poor economically.
Sana, a teacher, said prices of essential food items, electricity and gas were increased but salaries of teachers remained the same. She said it was very difficult to make both ends meet.
Another citizen commented that that hike in POL prices had exposed hollow claims of the government for stabilising economy. He claimed that increase in prices lacked justification because oil prices in the international market were falling.
“The poor is getting poorer and the rich richer. More and more people are committing suicides due to increasing poverty and unemployment,” said Samina Shakil, a housewife. She said prices of essential food items had gone beyond the reach of a common man and the situation would worsen after the recent surge in petroleum prices. “In these days of inflation, managing a kitchen has become very difficult,” she said.
Shaharyar, a medical representative, said the surge in petroleum prices was not suitable for salaried class, as it would put more burden on them. He said it was the time to provide relief to general public but the government was doing the contrary. He said President Asif Ali Zardari should take notice of surge in the petroleum prices.
Traders told Pakistan Today that transportation and cost of production would increase due to the increase in POL prices. They said the government should consider the matter carefully before increasing fuel prices.
Kashif Khan, a businessman from I-10, proposed that the government should hold up increasing POL prices in global market for preventing local industries from being collapsed.
Hayat Khan, an agriculturist, said the increase was an anti-farmer measure and would ruin the agriculture sector. He said farmers were already facing financial crunch due to shortage of irrigation water and high prices of agricultural inputs.
A month ago, Federal Minister for Water and Power Naveed Qamar disclosed that the government had decided to provide a Rs 8 billion subsidy on diesel to maintain its price at the existing level, and in March the government even gave a Rs1.8 billion subsidy, but to everyone’s surprise, from April 1 the government is refusing to provide the subsidy and has instead increased the price of HSD, which is heavily used in power houses and for the transportation of all goods – particularly kitchen items.
In other words, this means that in future power tariffs would not only increase because of the hike in diesel prices, but the price of kitchen items would also go up, bringing about another deadly spate of inflation.
Under the notification, Ogra increased CNG prices in Region-I (KP, Potohar and Balochistan) by Rs 11.58 per kg owing to which the new CNG price in Region-I now stands at Rs 88.70 per kg. In Region-II (Sindh and Punjab), the government has increased the price of CNG by Rs 9.93 per kg to Rs 80.89 per kg.
Commenting on the increase, residents said the government would be earning Rs7 billion in terms of petroleum levy for April and collections in terms of GST on petroleum fuel would be Rs18 billion. “During the current fiscal year the petroleum sector remained the leading contributor in the overall tax collection by the FBR and its share has been 43 per cent in total GST collection,” they said.
As per the official notification issued by Ogra on direction of Ministry of Petroleum, the price of petrol has been hiked by Rs8.02 per litre to Rs105.08 per litre, high speed diesel has increased by Rs4.70 per litre to Rs108.10 per litre, High Octain Blending Content (HOBC) has shot up by Rs8.94 per litre to Rs135.81 per litre, kerosene oil has jumped by Rs5.29 per litre to Rs101.69 per litre, and Light Diesel Oil (LDO) has skyrocketed by Rs5.45 per litre to Rs98.74 per litre.
The government has cited rising prices of oil products in the international market as the reason behind the increase.
