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Is Pakistan’s finance minister in the firing line after Nawaz Sharif objects to fuel hike?

Pakistan Finance Minister Miftah Ismail

Pakistan’s Finance Minister Miftah Ismail has come under the spotlight for continuously increasing fuel prices. Will he remain as finance minister, is one question that many are now asking.

The decision to hike petrol price by (Pakistani) Rs 6.72 per litre from yesterday despite easing of global prices has not been taken well by his own party supremo and other members.

In a tweet, Maryam Nawaz Sharif, daughter of PML-N chief Nawaz Sharif and vice president of the party, said that the decision was “strongly opposed” by her father. “Mian Sahib strongly opposed this decision and even said that I cannot burden the people with one more penny and if there is any compulsion from the government, I am not involved in this decision…” she said.

A litre of petrol now costs (Pakistani) Rs 233.91, up from Rs 227.19. The price of high speed diesel, which is primarily used by commercial vehicles, however came down a tad bit. From (Pakistani) Rs 244.95 a litre earlier, it will not cost Rs 244.44.

Ismail has defended the move saying that the decision to set fuel prices is done by Pakistan State Oil (PSO). At a press conference he asked, “Should we start repeating mistakes and picking fights with the IMF (International Monetary Fund) particularly when the economy has shown signs of stability?”

Responding to a question, Ismail said the petrol levy will increase from September 1, “whether I stay [the finance minister] or not.” The Shehbaz Sharif government has added a petroleum levy of Rs10 per litre on POL (petrol, oil, lubricants) from July 1.

“The Rs10 per litre petrol levy will increase by 100 per cent. [It will] happen from September 1, whether I stay or not,” he said.

The sharp price rise has been prescribed by the IMF, which is expected to approve disbursal of a bailout package by the end of the month. The IMF executive board is slated to meet on August 29.

Needless to say, the decision to further hike petrol prices has angered the people of Pakistan at a time when headline inflation touched 24.9 per cent in July — the highest since 2008. In June it was 21.3 per cent.

The hike in petrol prices will further push inflation.

Earlier, Ishaq Dar, Pakistan’s former finance minister who is also a senior Pakistan Muslim League member too warned of dire consequences in case Islamabad accepted the IMF diktat.

Also read: Cash strapped Pakistan now set to get Saudi, IMF assistance by month-end

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