Fuel prices to remain unchanged ‘for now’

Miftah says Shehbaz opposing hike in POL rates

ISLAMABAD:

Finance Minister Miftah Ismail on Sunday said the government was not increasing the prices of petroleum products “for the time being” – a decision that was against one of the key pre-conditions set by the International Monetary Fund (IMF) for the revival of the country’s loan programme – and might reconsider its move soon.

Addressing a news conference in Islamabad, Miftah said Prime Minister Shehbaz Sharif, despite his advice against the move, was unwilling to overburden the people by jacking up the fuel prices.

He added that PM Shehbaz firmly believed that increasing petroleum prices was not an option considering the difficult position the people of Pakistan already found themselves in.

The minister added that a summary for this purpose had been sent to the premier for a swift decision.

"I will talk to the IMF to find a middle ground. [The talks] will conclude positively. ”

However, the minister clarified that fuel prices could be "adjusted anytime in the future" in line with the growing international oil prices.

"I am not saying we will never increase the prices. The point is we are not increasing them today, but we can adjust them at any time in the future.”

After his news conference, the minister reiterated his message on Twitter.

“Let me amplify what I just said in my presser,” he wrote. “The government will not raise POL prices today. But due to changing circumstances and international oil prices, we may have to revisit our decision soon.”

During the news conference, the minister, while referring to PTI Chairman Imran Khan's criticism of the current government over the plummeting value of the local currency, took a dig at the former premier calling him the “king of rupee devaluation”.

The minister also said that while the PTI chief boasted of having increased the country's foreign reserves, there was no evidence to support his claims. "Where have you put the money you speak of?"

He blamed the PTI government for being unable to curb the smuggling of wheat and petroleum, and “wrecking” the economic stability of the country.

Ismail claimed that the previous regime had promised the IMF in December last year that the primary deficit would be Rs25 billion and the total deficit would be around Rs4 trillion. "The primary deficit has increased from Rs25 billion to Rs1.32 trillion," he added, questioning how could the new government bring it down in a few months.

The minister also alleged that the IMF had ended its programme with the PTI-led government and the latter wanted to keep the development under wraps.

The minister said friendly countries including Saudi Arabia had assured economic cooperation and talks were under way for the extension of the deposited period.

He added that the Saudis had promised to extend the term of deposits from December this year. “They have also agreed to negotiate an increase in deposits.”

Informing about the wheat production which is 26 million tonnes as per the official record, he said on the instructions of the prime minister, the government was keeping its reserves.

The minister further maintained that according to the current situation, imports were expected to touch $75 billion.

However, Miftah added that the current account deficit would increase significantly as the exports in return were expected to reach $30 billion despite the $30 billion remittances recorded in this financial year.

He noted that at present the State Bank of Pakistan’s (SBP) foreign reserves stood at $10.4 billion, which had fallen to this level because of the mismanagement of the previous administration.

The minister added that the tax-to-GDP ratio in the previous government had also dropped to 8.5%.

The verbal duel between PML-N and PTI leaders over the deteriorating economy continued as Miftah dismissed Asad Umar's comments as “lies”.

"I wish he wouldn't lie despite his company", he added.

Earlier in the day, the minister, while responding to PTI leader Umar's tweet, accused the previous government of taking “80% of all debt” in the country’s history.

“When we left govt in 2018, we were exporting wheat and sugar. You ended up importing sugar & wheat, produced the lowest cotton since 1983/84, took 80% of all debt taken in the previous 71 years. Had the highest imports,” Miftah wrote.

Umar had stated in a tweet that the country's growth forecast this year had been over 5% before a vote of no-confidence had left the PTI government packing.

“Great crops numbers coming in particularly sugar cane, maize, rice and potato. Plus the double digit growth of large scale manufacturing recently released means growth for this year should be even higher than the 5.6% last year,” the former planning and development minister had claimed.