The federal government has increased the price of petrol to a historic high in a bid to appease the International Monetary Fund (IMF) for unlocking the critical loan tranche, hours after unveiling a tax-loaded ‘mini-budget’.
The new prices came into effect from 12am Wednesday night, a press release from the Finance Division read.
The price of petrol has been moved up to Rs272 per litre after an increase of Rs22.20, the Finance Division said, noting that the surge has taken place due to the rupee’s devaluation against the dollar.
The price of high-speed diesel has been increased to Rs280 per litre after a hike of Rs17.20. Kerosene oil will now be available at Rs202.73 per litre following a Rs12.90 hike. Meanwhile, light diesel oil will be available at Rs196.68 per litre after an increase of Rs9.68.
The increase in the price of petroleum products was one of the preconditions of the Washington-based lender, which will lead to an increase in the already record-high inflation.
The government is in a race against time to implement new tax measures and reach an agreement with the IMF as the country’s reserves have depleted to a critically low level of $2.9bn, which experts believe is enough for only 16 or 17 days of imports.
The agreement with the IMF on the completion of the ninth review of a $7bn loan programme would not only lead to a disbursement of $1.2bn but also unlock inflows from friendly countries.
