With the ongoing war in Iran driving up fuel prices in Pakistan, the government is reportedly mulling several contingency measures reminiscent of the Covid era to reduce petroleum consumption. Some measures include a four-day workweek, allowing up to 50% of employees to work from home and closing markets earlier in the evening.
If markets are closed early then many traders and businesses might be looking at a rough end to Ramazan and Eid, which is usually a key earning period for them. Instead, many households could be forced to cut back sharply as transport and logistics costs ripple through the wider economy.
Passing through higher international prices is fiscally unavoidable, particularly under IMF constraints that limit subsidies and reductions in petroleum levies. But that does not mean the broader economic burden should fall entirely on ordinary households and salaried workers. If higher prices are unavoidable, the government must at least ensure that relief elsewhere in the fiscal system offsets some of the shock — whether through targeted support for essential sectors such as transport and agriculture or through tax relief in the coming budget.
Reducing dependence on oil through more efficient transport systems, expanded public transit and greater investment in renewable energy will ultimately be the only durable way to insulate the economy from wars and crises that occur thousands of kilometres away. The government must move swiftly from statement to enforcement.
Qazi Jamshed Alam Siddiqui
Lahore
