LAHORE: The common people and business community have widely criticised the government for a sudden record hike in petroleum, oil and lubricant (POL) prices at the time when the nation is passing through the worst recession due to the Covid-19 and demanded it immediately withdraw its decision.
“It clearly shows that the government is acting against the poor who were already crushed almost before the pandemic. This government must pack up now in the best interests of the people and this country,” Riaz, a motorcyclist, says while speaking to Dawn at a filling station in Johar Town on Saturday.
“On Friday night, I couldn’t get petrol on previous rates due to long queues before 12am. Today, there is no issue at the petrol pumps since the rates have been increased,” he deplores. “I would request the government to bring oil prices back as they were before 12am (Friday),” he demands.
Criticising the government, Lahore Petroleum Dealers Association Chief Khwaja Atif says the mafia finally succeeded in getting a raise in the oil prices by pressuring the government.
“It is a routine process that on 30 or 31st(last date) of any month, oil prices are reviewed, increased or decreased by the Oil and Gas Regulatory Authority (Ogra). But this government is behaving in a strange manner, as it reviewed prices on 23rd of the last month and now on 27thof the current month,” he says, adding that this clearly shows that the mafia is ruling the government.
The Lahore Chamber of Commerce and Industry (LCCI) has urged the government to withdraw the hike in oil prices that is bound to jack up the cost of doing business in Pakistan.
In a statement on Saturday, LCCI President Irfan Iqbal Sheikh says there is no denying the fact that oil prices are on the rise in the international market but instead of passing this surge on to the masses, the government should cut the number of taxes on petroleum products as the fuel is the engine of growth.
“If the fuel is heavily taxed, the entire economy would suffer and the same happened in Pakistan,” he opines.
Mr Sheikh points out that because of the high cost of doing business in Pakistan, a large number of industrial units have already shifted their operations to other countries and the recent decision would force more industrialists to shift their industrial units outside Pakistan.
“It is not the industrial sector alone but the agriculture sector would also badly suffer. The increase in petroleum prices would raise the inputs cost as well as that agriculture production as high speed diesel is being used in tractors, tube-wells, harvesters, thrashers and other agriculture machinery,” he explains.
The Pakistan Hosiery Manufacturers and Exporters Association (PHMA) also lashed out at the government for increasing prices of petroleum products in an extraordinary and unexpected move, which would lead to increasing cost of production and cost of doing business as well.
PHMA vice chairman Shafiq Butt, in a statement, argues that the high cost of business is already hindering Pakistan in achieving its export targets. However, he appreciated the State Bank of Pakistan’s decision to lower the discount rate by 100 basis points, bringing it to 7pc, which will spur economic activity, slowed down by the coronavirus outbreak.
“A cumulative reduction of more than six percent in interest rate in just a few months would cut cost of production, strengthen debt repayment ability and improve credit worthiness but the latest move of hike in oil rates will wash up the whole benefit provided to the industry,” he observes.
Mr Butt says the government announced the increase in oil rates through a statement, without giving any reason for this huge jump that will definitely affect every segment of the society.
He said the government, instead of taking action against the oil marketing companies for not providing the POL products at lower prices, totally surrendered before the cartel and increased the prices four days before the end of the month, apparently to appease the oil companies.
Published in Dawn, June 28th, 2020