Tarin rules out 'further' relief on fuel prices

Finance adviser says petroleum prices directly proportional to prices in global markets

KARACHI:

Finance Adviser Shaukat Tarin said on Sunday that the government will not able to provide relief to the public in case of an increase in fuel prices in the international market.

Talking to the media in Karachi, the finance adviser said the local petroleum prices were directly proportional to the prices in the global market.

"There is no relief in it. Whatever [price hike] comes will be passed through [to the people]," he said. According to Tarin, the government does not have space to provide "further relief" as he has already brought down sales tax on petrol from 17 per cent to 1.6 per cent.

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It may be noted here that petroleum prices in Pakistan have touched an all-time high with petrol being sold at Rs146 per litre. This, coupled with the devaluation of the rupee against the US dollar, has resulted in a high inflation rate across Pakistan.

Tarin said there will be good news on talks with the International Monetary Fund (IMF) soon, adding that the IMF announcement will also put an end to speculative trading in the exchange market.

According to Tarin, as per the real effective exchange rate, the value of the Pakistan rupee against the dollar should be Rs166 but it was being manipulated by the "speculators".

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Due to speculators, the rupee is devalued by Rs9 at least, he said, adding that he has asked the State Bank of Pakistan to take measures to end the speculative trading.

According to Tarin, the rupee is also being devalued due to the Afghans who are buying dollars from the market.

The finance adviser claimed that the Pakistani economy could witness more than five per cent growth during the current financial year. Tarin said the revenue had witnessed 36 per cent growth, adding that manufacturing growth was in double digits as well. Pakistan also reported bumper crops this year, he added.

We have 32pc growth in income tax, and our growth is all-round, including sales tax, income tax and customs. We will try to increase revenue target to 11pc from 9pc and then 14pc after it," Tarin said.

Speaking about the hike in the price of food items, the finance adviser said that the food prices were on the rise due to the coronavirus pandemic.

“The prices of food increased globally. Pakistan imports some important food items and our common citizens are affected due to the increase in prices.”

Tarin admitted that Pakistanis have poor purchasing power in contrast to other countries. “We are trying to fix it,” he added.