Fuel price woes

Published June 17, 2022

THE third hike in three weeks. More pain yet to come.

Citizens who have visited the fuel pump after the government’s third late-night surprise must have left with a deep sense of unease thinking about what the days ahead will bring. The large hole just fuel itself is burning in our household budgets is expected to grow as the next fiscal year starts on July 1, when the government’s budgetary proposal to stack the petroleum levy and sales tax on top of the per-litre cost of petrol and diesel takes effect. It will be followed by a likely increase in the costs of nearly all other expenses due to higher production and transportation costs.

It is, unfortunately, quite a glum scenario, and one that seems quite unavoidable given global market conditions and the state of our country’s finances.

Unless the government can find new streams of revenue to create fiscal space for subsidies, the public will bear the brunt of the inflation.

Citizens can cut some costs immediately on their end by curtailing travel for necessary tasks only, carpooling where possible and using smaller, more fuel-efficient vehicles instead of ‘gas guzzlers’ if the choice is available. At home, lifestyle changes like the conservation of electricity and cutting back on consumption of non-essential, imported goods can help reduce monthly expenses.

Read: Consumers to get short end of fuel price stick

Employers must consider work-from-home arrangements where possible to help employees save on commuting costs.

This should also be a strong wake-up call for policymakers, who need to devise more well-thought-out strategies to enable the citizenry to switch to cheaper sources of fuel and electricity. Promotion of technologies to harness solar power is acquiring greater and greater importance as people struggle with the soaring costs of electricity.

The government has cut sales tax on panels in a bid to encourage adoption of solar power, but more should be done. Likewise, there needs to be a greater effort to push the automobile industry to produce vehicles that prioritise fuel efficiency.

Ownership of electric vehicles should be incentivised to encourage people to make the switch to greener vehicles that cost far less to run than those that run on petroleum products. There should be incentives for Pakistani engineers and entrepreneurs who wish to set up ventures that can help indigenise both renewable energy technologies and electric vehicle manufacturing. It is better for our future to make solar panels and electric cars than tanks, bombs and bullets.

Finally, both the government and the PTI would do well to read the room. Pointing fingers will only worsen domestic instability and will not give the public any relief from economic misery. A joint effort is needed to bring the nation together for this latest challenge. With unity of purpose and national will, there is no crisis that cannot be weathered. Pakistan is resilient. This, too, shall pass.

Published in Dawn, June 17th, 2022

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