Govt absorbs decades’ highest international price-hike: Tarin

APP News Agency

01st Oct, 2021. 03:57 pm
CPEC ushers in new era of economic prosperity Tarin

ISLAMABAD: The government is absorbing the impact of the decade’s highest price-hike at the international level to provide relief to the people through various measures, including direct food subsidy to the poor, a senior official said on Friday.

Addressing a press conference along with Minister of State for Information and Broadcasting, Farrukh Habib, Federal Minister for Finance and Revenue Shaukat Tarin reiterated that the Covid-19 pandemic had triggered price hike across the globe, adding that since Pakistan was an importer of some essential commodities; hence, it was impacted too. However, he said the government did not pass on all this impact to the people.

Talking about the hike in petrol price, the minister said Pakistan was at the 17th number among the countries providing the commodity at the lowest prices, adding that the majority of the other 16 countries having lowest prices than Pakistan were oil-producing countries.

The petrol prices in the country were even lower than other regional countries, as it was being sold at Rs127/litre in Pakistan, whereas its price in India was Rs235/litre and Rs195/litre in Bangladesh.

The government wanted to reduce prices, as it had already slashed the petroleum development levy from Rs30 in 2018 to just Rs2.5/litre.

He said the government had budgeted Rs600 billion from the petroleum levy, which could be affected, as the prime minister wanted to provide relief to the people.

The minister said it was unfortunate that no proper attention was given towards the agricultural sector for the last three decades and resultantly, the country had become net importer of wheat, sugar, pulses and ghee and was directly affected by the world inflation.

Despite all this, the government took measures to provide relief to the people, particularly the poor, the finance minister said, adding that the government has to buy sugar at higher rates, but it would be available at around Rs90/kilogram.

Likewise, ghee prices that witnessed around 80 per cent to 90 per cent hike in the international market and were available at Rs350 in Pakistan, would come down to below Rs300/kg.

The government would also provide direct food subsidies to 12.5 million families, which constitute around 44 per cent of the total population. The subsidy would be provided on flour, sugar, ghee and pulses, he said.

Tarin also said that the government was also evolving a mechanism to minimise the role of the middle man, which he said, was one of the major causes of inflation, adding that the provinces have also been asked to reestablish provincial price administrators to control prices.

The economy of the country is growing, as the revenues have witnessed over 38 per cent increase and exceeded the target by Rs186 billion.

This means the economy was growing, he said, and expected that it would grow 5 per cent during the current fiscal year and resultantly it would have the trickle down effect.

The major sectors of the economy, including agriculture, industry and services sector were witnessing growth, the finance minister said, adding that Kamyab Pakistan Programme would also be launched soon, under which farmers would be provided interest-free loan of Rs150,000/crop, Rs200,000 interest-free loans on mechanisation, whereas the urban households would be provided Rs500,000/family to start businesses.

In addition, the government was also providing loans of up to Rs2 million at 2 per cent interest loans for the construction of houses, whereas health cards were being provided to facilitate people.

The prime minister was very concerned about the welfare of the common people, Tarin said, adding that the debt-to-GDP ratio came down by 4 per cent last year, expecting that it would come further down during the current year.

To a question, the minister said the government would sincerely negotiate with the International Monetary Fund.

He said: “We had promised to collect revenues of Rs5.8 trillion and the collection numbers to-date show that the target would be exceeded.

“There were certain challenges being faced by the power sector; however, enhancing the tariff rates, as advised by the IMF, was not a solution to the issue, so we would like the IMF to provide space in this matter,” the minister added.

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