Business News/ News / World/  Pak govt hikes petrol price by 10 per litre for next 15 days

Pakistan's government has decided to raise the cost of petrol by 10 per litre for the ensuing 15 days, said finance minister Ishaq Dar. This came amid the country's worst economic crisis and steep currency devaluation along with increasing interest rates. 

High-speed diesel, and light diesel oil rates remained stable, whereas the price of petrol increased to (PKR) 282 per litre. Kerosene oil's price is also increased by (PKR) 5.78 per litre.

The Finance Division explained the increase in petroleum product prices in a statement by citing “increased petroleum costs in the international market and currency rate variance", Geo News reported. 

Inflation for March 2023 clocked in at 35%, which is amongst the highest-ever levels. For the more vulnerable segments, inflation is close to 50%, as food prices spiral out of control, reported The News.

The catastrophe is occurring as the administration makes little progress towards securing a staff-level agreement (SLA) for the restart of a stalled IMF bailout. Importantly, the persistent decline of the rupee and historically high food prices are fueling high inflation rates. 

Meanwhile, the United Arab Emirates confirmed financial support of $1 billion to Pakistan, removing yet another hurdle before the cash-strapped nation can secure funds from the IMF.

The international body had previously stipulated that Islamabad should secure $3 billion from other countries for the revival of its USD 6.5 billion bailout package.

Having secured the necessary financial support, Pakistan is now set to obtain a tranche of $1.1 billion which is crucial for the country to resolve an acute balance of payments crisis. The funds - to be released after a staff-level agreement is reached - had originally been due for disbursement in November last year.

The IMF recently lowered its forecast for Pakistan’s economic growth rate from 2% to a mere 0.5% for the current fiscal year amid high inflation and a growing unemployment rate. The country continues to tether on the verge of default with just over $4 billion in reserves.

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Updated: 16 Apr 2023, 07:34 AM IST
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