PM confers with allies on unsettling economic woes

ISLAMABAD:

Prime Minister Shehbaz Sharif began his consultations with the government allies on Monday, discussing with them the decisions taken during a top-level huddle of the Pakistan Muslim League-Nawaz (PML-N) in London to steer the country out of the current political and economic crises.

Shehbaz, who took a detour to Abu Dhabi while returning from London, to condole with the new United Arab Emirates (UAE) President Sheikh Mohamed on the demise of his predecessor Sheikh Khalifa, met with Asif Zardari, Maulana Fazlur Rehman and Dr Khalid Maqbool Siddiqui.

Last week, Shehbaz led a 10-member ministerial delegation to London to discuss the multiple challenges facing the government, including fuel prices, the anti-government campaign of former prime minister Imran Khan and the revival of the International Monetary Fund package, with party Quaid Nawaz Sharif.

Later, several ministers said that plan had been finalised in London, and that the government would consult its allies before announcing it. Information Minister Marryum Aurangzeb said on Saturday that after taking the allies into confidence, Shehbaz would address the nation.

On Monday, Shehbaz discussed the ongoing situation and coalition matters with former president and Pakistan Peoples Party (PPP) Co-chairman Asif Zardari, Jamiat Ulema-e-Islam-Fazl (JUI-F) chief Fazlur Rehman and Muttahida Qaumi Movement-Pakistan (MQM-P) Convener Khalid Maqbool Siddiqui.

The first meeting was held between the prime minister and Siddiqui, in which “the political and economic situation” was discussed in detail, according to an official handout issued by the media wing of the Prime Minister’s Office.

The handout read that the prime minister welcomed the cooperation of the coalition parties in implementing the government’s reforms and called for their cooperation on the decisions to be taken in the future in national interest.

“The MQM-P Rabta Committee will deliberate on the issues and apprise the prime minister about its decision,” Siddiqui told The Express Tribune after the meeting. He stressed that new census and delimitation should be completed before the next elections.

To a question, Siddiqui said that the issues would be discussed in the federal cabinet meeting on Tuesday (today). “The prime minister wants to take the allies with him and that may take a couple of days more before anything is announced,” he said.

Later, Shehbaz discussed the on-going political and economic situation with Fazl. The handout said that the prime minister reiterated his commitment to providing essential commodities to the people at affordable prices to provide them relief.

The handout said that the prime minister stressed the need for all the allied parties to work together to ensure stability and welfare of the people, saying that all decisions should be taken in the national interest. Shehbaz also met former president Zardari but no statement was issued.

The coalition government is expected to deliberate further on the issues in the federal cabinet’s meeting on Tuesday (today). The information minister had earlier said that the prime minister would take all decisions with the consent of the allies and reveal them in his address to the nation afterwards.

According to political experts, the major decisions the government would take in consultation with the allies pertained to ending the subsidies on petroleum products, which is linked to the revival of the IMF package and agreeing to the timeframe for the next general elections.

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The government has entered into its second month after removing Imran Khan from power through a no-confidence motion but its indecision on several matters including inflation, oil subsidy and the new elections was taking its toll on the national economy.

The political experts suggested that the exploratory meetings were being held to see if the coalition parties would be happier together till the remaining constitutional period of the government or should they announce early elections.

It’s also being examined if the “coalition” still has the appetite for working together or should the elections be held with or without new census and delimitation, though, the Election Commission of Pakistan (ECP) had already stated that elections couldn’t be held in the next few months.

Some experts said that the allies were clear about the elections schedule but the PML-N was taking time to clear the confusion within its ranks. They said the government was also looking for some assurances from the establishment that it won’t suddenly push for elections if the government took some time.

Oil subsidy

The cabinet meeting on Tuesday (today) is also expected to take up the oil subsidies, sources said, adding that a freeze on oil prices irked the oil industry amid fears that it could lead to economic collapse. The sources said the cabinet would take the decision after all allies were taken on board.

The government allies had proposed three options to the prime minister about raising the oil prices: prices of should be increased for the elite; rationing of the petroleum products for public transport; and, the government should give subsidy to the poor or middle class on motorcycles.

Dr Siddiqui of the MQM-P, however, said that they had asked the prime minister to subsidise fuel for the poor and increase the prices for the rich. “The rich should take the burden of the poor,” he told reporters at a news conference.

The oil industry had warned that maintaining the current oil prices was building pressure on the industry due to piling up of the price differential claims (PDC). The sources said that the Petroleum Division had sought allocation of Rs118 billion to clear the subsidy on petroleum products for the month of May.

However, it is learnt that the Finance Ministry had not agreed to the approval of entire amount. Instead, it agreed to clear Rs54 billion on account of the PDC during May. An Economic Coordination Committee (ECC) meeting on Tuesday (today) is likely to approve the Rs54 billion allocation.

Waqar Irshad Siddiqui, the chairman of the Oil Companies Advisory Council (OCAC), said that the PDC payments were increasing the financial constraints on enabling sustained oil imports in the wake of the ongoing situation.

According to the OCAC chief, 70% of Pakistan’s energy requirements were met through fuel imports but the depleting rupee value, rising oil prices in global markets and the rising oil demand were putting severe pressure on the liquidity positions of the Oil Marketing Companies (OMCs).

Waqar Siddiqui rejected “the false claims of fuel shortage” in the country. “The sales figures for the month of April and initial two weeks of May 2022 represent a clear commitment of the OMCs by fulfilling surged demand due to the ongoing harvesting season…” he said.

 

Extending OCAC’s support to the authorities, he said: “The downstream oil sector, despite all odds, aims to carry forward the commitment of fulfilling country’s fuel needs with the support of the concerned authorities and ministries for the prosperity of the country.”