- And petroleum prices
Forcing a Rs4.3 decrease in petrol price after a Rs7.5 increase will hardly bring much relief to the common man, something that obsesses the chief justice, but ordering an inquiry into petroleum prices will definitely open a Pandora’s Box which, if followed through to the end, might well give some breathing space to the ordinary consumer. For a country that imports more than 80pc of its oil, Pakistan’s pricing structure is ridiculously, and quite mysteriously, wrapped in a web of very regressive taxation. But that is only a small part of a very big problem.
Just as our oil is imported “on loans”, as CJ Nisar rightly noted, our economy (which means the country) runs predominantly on borrowed money. And since – as this inquiry will surely reveal – much of the state money is simply squandered, and some stashed away in private offshore shell companies, the country requires more loans each year just to keep functioning. The repayment is ensured through the small pockets of the common man, unfortunately, through violent taxation just like the petroleum formula. If there weren’t heavy surcharges on payments that simply have to be made – that is, on goods with inelastic demand – which the common man, unlike the rich and powerful, cannot sidestep, our democracy would have dragged us to default a long time ago.
Ultimately there is little the chief justice, or even the prime minister, can do about oil prices. Once the graph moves internationally — and Brent has long since rebounded, and rises as we speak even though Trump has bullied Opec into more production once again – prices here must move as well. But the chief justice is spot on in noting the unfair taxation that exploits and squeezes the working class. With inflation already rising, and expected to for some time to come, oil must remain within control. However, the chief justice will have to see if he can influence our chronic addiction to debt, the dangerous deficit, not to speak of chances of default, otherwise this exploitative system of taxation will remain.