Pakistan likely to increase fuel prices

Islamabad: Fuel prices in Pakistan are expected to rise before August as the country is required to meet conditions imposed by the International Monetary Fund (IMF), local media reported citing sources.
The levy on petrol may go up by Rs5 per litre while the Diesel levy is expected to be increased by Rs10 per litre. The government of Pakistan has also decided to increase the dealers' margin to Rs7 per litre which will cause an increase in the fuel prices, reported ARY News. The decision to increase the fuel prices is expected be made on July 31.
Earlier, Pakistan Finance Minister Miftah Ismail said that the staff-level agreement with the IMF was expected to take place in mid-June of this year. It also indicates that the agreement is expected to be made only after the announcement of the next budget, in line with the IMF programme's objective.
However, the IMF wanted rapid adjustments on the fiscal front in order to bring the economy back on the stabilisation path. The announcement of the next budget for 2022-23 aligned with IMF policies will set the stage for a stabilisation path to Pakistan's dwindling economy, however the government will have to take tough decisions, instead of doling out resources to gain political support.
In such a case, the IMF proposes that the Federal Board of Revenue increase its tax collection target for the next budget by up to Rs 7.5 trillion and cut both development funding and subsidies.
Despite the government's desire to maintain petroleum product prices at their current level as of June 1, 2022, it will have to shift the burden to consumers following the release of the budget. (ANI)