According to the International Monetary Fund (IMF), Pakistan’s government did not seek advice from the international lender before implementing its low-income groups’ fuel subsidies, according to a Tuesday Bloomberg article.
The government’s idea to boost fuel costs for more affluent drivers to pay for a subsidy for those with lower incomes, according to Esther Perez, the IMF’s resident representative for Pakistan, was not discussed with the lender, she told the journal.
According to Perez, the fund staff is looking for further information on the scheme’s operation, cost, targeting, safeguards against fraud and abuse, and mitigating measures. They will carefully address these aspects with the authorities.
A day earlier, the federal government declared that it will subsidize fuel up to Rs. 100 for motorcyclists and owners of automobiles up to 800cc in order to lessen the impact of rising gas prices on the people who are already suffering from inflation.
Malik informed reporters in Lahore that Prime Minister Shehbaz Sharif had ordered that low-income individuals receive fuel subsidies of up to Rs 100 per liter. A 50 rupee per liter subsidy was previously established.
According to the minister, a comprehensive approach will make subsidized gasoline available to motorcyclists and owners of cars with engines up to 800cc. Malik added that owners of automobiles with engines larger than 800cc would be paid in full.
He added that the government would lower the cost of petrol for the poor within six weeks of making the decision to offer fuel at discounted rates.
“The owners of big vehicles will pay more for petrol. The rich will pay Rs100 more for petrol while the poor will pay Rs100 less. 210 million people are poor in a population of 220 million, we stand with poor Pakistan.” He stated that the gas rate decision went into effect on January 1st. We have different tariffs for the wealthy and the poor.