By Staff Reporter
ISLAMABAD: A day after giving the stick of a fuel price hike, Prime Minister Shehbaz Sharif Friday dangled the carrot of a Rs28 billion/month inflation allowance before the nation’s poor, justifying the move as inevitable.
“The PMLN government has picked up the gauntlet to pull the economy through, come what may,” said the premier in his maiden televised address to the nation on Friday night.
He also heralded a trifling monthly cash support for the poor families, which is hardly going to be of any consequence given the inflationary trends.
“We were fated to go down that path as it was sealed by the previous government by agreeing to the terms of IMF (International Monetary Fund) to continue a $6 billion loan programme.”
Economists very well know what PTI did, but are curious about what the PMLN government may have done to change this if their situations are reversed.
In a last-ditch effort to save a fiscally-constrained economy from defaulting on its international obligations, the PMLN government on Thursday willy-nilly increased the fuel prices to win an IMF bailout, apparently ignoring the dent to its political capital.
To offset the impact of the fuel price hike, PM Shehbaz said that his government would offer a Rs28 billion relief package, under which some 14 million families will be provided Rs2,000 per month in monetary support. This package, he said, would be included in the budget for the upcoming fiscal year.
He clarified that the new stipend would be in addition to the one underprivileged families receive under Benazir Income Support Programme.
PM Shehbaz said the government has also decided to maintain the price of wheat flour at Rs400 per kilogramme at the government-run Utility Stores.
The government raised the local oil prices because of the record high international market as Pakistan is a net importer of the petroleum products that have gone through the sky in the global market, the premier said, adding the fuel oil subsidy reversal was a painful decision.
“Taking the helm of an economy that has been adrift in troubled waters for the last four years is a tough test,” the premier said.
In the breath he added that despite the sheer hard work and risks involved, it was also an honour for him to spearhead the revival of the economy as the Prime Minister of Pakistan.
“The previous government left a mountain of an economic mess behind, but we accepted the challenge to clean it, because we can.”
He rebuffed Imran Khan’s conspiracy theories that his government’s ouster was imported, adding that the National Security Council and Pakistan’s ambassador to the US had twice rubbished such allegations.
“Pakistan will run according to the Constitution not by the stubborn whims of Imran Khan.”
PM Shehbaz blamed the PTI government for the runaway inflation and record corruption in the country, and maintained the deal with the IMF was signed by the Khan’s government and not his.
He also outlined his future economic strategy and policies to restore investor and public trust in the government.
He was originally scheduled to address the nation on May 18 but postponed the decision amid political uncertainty in the country as PMLN seemed divided on calling a fresh election or ruling for one-and-a-half-year until the National Assembly completes its five-year term in August 2023.
The Extended Fund Facility (EFF) programme, launched in 2019, hit a suspension wall a few months back after popularity-challenged former prime minister Imran Khan capped the fuel prices for four months at a cost of $600 million a month. This subsidy is smothering the economy.
The new government mustered courage to call it off thrice but bottled out owing to political expediency. This dastardliness had started casting doubts on the PMLN-led government’s ability to take tough steps to win the IMF programme back.
The IMF, in its talks, stressed on the urgency of “concrete policy actions”. Revival of the IMF programme unleashes the rest of the loan.
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