Pakistan plans app-based fuel subsidy for low-income users amid energy crisis
As the city runs on fumes, motorcyclists line up at a petrol pump in Karachi, waiting their turn amid surge in fuel prices. Photo: Jalal Qureshi / Express
The government has decided to introduce a mobile application-based system to provide fuel subsidies to low-income consumers as it seeks to manage the ongoing energy crisis and conserve supplies.
Under the proposed mechanism, subsidised petrol distribution will be handled through a digital platform, allowing eligible users to obtain fuel through verified quotas. The Ministry of IT will procure 24,000 mobile phones for the project, while the National IT Board will determine pricing for the devices.
Oil marketing companies (OMCs) will purchase the phones and distribute them to petrol stations nationwide. Around 24,000 devices will be deployed across approximately 12,000 petrol pumps, with two designated nozzles at each outlet reserved for subsidised fuel.
The system is primarily aimed at supporting two- and three-wheelers. Consumers will receive digital vouchers through the mobile application, which has been developed and is in the final stages of testing. A QR code mechanism will be used to verify transactions, with a formal announcement expected soon.
Users will not be allowed to exceed a fixed monthly quota. Motorcycles are expected to receive between 20 and 30 litres of subsidised petrol per month, while a final decision on extending the scheme to vehicles up to 800cc is still pending.
Officials said monitoring of petrol pumps across the country has already begun to ensure transparency and operational efficiency. The initiative follows a meeting held at the Oil and Gas Regulatory Authority (OGRA), attended by officials from the IT ministry, finance and petroleum divisions, where a quota-based fuel distribution plan was finalised.
Read: Mobile app-based fuel quota system on cards
During the meeting, participants were informed that the ministries of finance and foreign affairs are also engaged in parallel diplomatic efforts involving Iran and Saudi Arabia to manage broader energy supply challenges. Authorities said the digital system is being fast-tracked to maintain uniform implementation and prevent discrepancies across retail outlets.
The government said it had provided Rs69 billion in petrol and diesel subsidies over the past two weeks and now intends to shift towards targeted, direct support for two- and three-wheeler users.
Hardware distribution
Under the plan, each retail outlet must operate at least two dedicated mobile phones to run the subsidy system. The Ministry of IT is coordinating with manufacturers to supply specialised devices.
Initial procurement costs are estimated at Rs36,000 per unit, with retail pricing around Rs72,000. Petrol pumps will deposit funds into a designated government account, the details of which will be communicated by OGRA, to ensure immediate delivery of devices.
Quota mechanism and vouchers
Vehicle-based quotas will be linked to users through vehicle registration numbers and CNIC verification. Consumers will generate digital vouchers via the app, which retailers will scan or enter into their system.
The platform will automatically validate available quotas. For example, if a user requests 20 litres but only has 15 litres remaining, the system will allow dispensing only the eligible amount. Officials said the mechanism is modelled on the previously implemented Ramazan Package system.
Subsidies and pricing
Retailers will allocate specific dispensers for subsidised fuel distribution to two- and three-wheelers. Authorities have yet to decide whether four-wheelers will remain eligible for subsidies.
The government said it would ensure timely fuel pricing adjustments to protect retailers from licensing complications and sudden price increases, aiming to avoid disruptions similar to the 2020 fuel crisis.
OMCs have also been directed to submit details of a focal person for each retail outlet, including name, CNIC and contact number, despite OGRA already maintaining outlet records.
Implementation and oversight
Retailers have been instructed to immediately share focal person details for coordination. The Ministry of IT will provide demonstrations and video tutorials to assist operators in using the system.
Officials said an emergency dispensation mechanism has also been built into the framework to allow approvals through a designated process if required, as the government continues to face critical pressures on fuel supply chains.