ISLAMABAD - The government has announced a major cut in the prices of petroleum products as it has been facing severe criticism by friends and foes alike for not addressing the issues of the common man.

The decision to cut prices was announced by Prime Minister Nawaz Sharif while chairing a special meeting of the federal cabinet on Friday.

"I feel immensely satisfied that the reduction in the prices of petroleum products has been made possible despite adverse circumstances which speak volumes about the performance of the government and we would ensure that the reduction definitely benefits (all) the people across the country,” the PM said.

As per the decision, per litre price of petrol has been slashed by Rs9.43 from Rs103.62 to Rs94.19, diesel by Rs6.18 from Rs 107.39 to 101.21, kerosene oil by Rs8.16 from Rs95.68 to Rs87.52 and high octane by Rs14.68 from Rs131.13 to Rs116.45. It is the biggest slashing of petroleum prices in a go.

The ruling Pakistan Muslim League-Nawaz (PML-N) was intensely criticised particularly by two protesting parties, the Pakistan Tehreek-i-Insaaf (PTI) and Pakistan Awami Tehreek (PAT), for making the life a hell for the poor and lower middle class. In recent past, even ruling party’s own allies as well lawmakers from other parties also criticised it during the joint session of the parliament for not passing the reduction of oil prices in international market to the common man.

After the announcement of the decision, the PM directed chief ministers of all provinces to ensure that the entire impact of the reduction in the prices of petroleum products must reach the common man. He directed the provincial governments to keep a check on transport fares and prices of fuel and other basic commodities.

Though the meeting was convened to evaluate performance of petroleum ministry, the PM did not miss the opportunity to reject the criticism of his government and projected the government’s performance as positive.

PM Nawaz Sharif said that negative politics have damaged the national economy, but the government remained determined to bring about a turnaround for the welfare of the masses and prosperity of the country. He said the government had inherited a number of challenges that would need time and resources to address, therefore the government must be allowed to complete its five-year term so that it could fulfil the promises made to the people.

"Despite the sit-ins and political disturbances to obstruct the progress and prosperity of the country, the present government has succeeded in passing on the decrease in international oil prices," the prime minster said. "Owing to the positive policies of the government the value of Rupee against US dollar also improved as the value of dollar declined by Rs13," he added.

Talking about impact of sit-ins of PTI and PAT on economy, he said that these led to decline in foreign investment and slowed down the pace of progress. Instead of getting the issues resolved through parliament and the Supreme Court the protesters were trying to dictate their own decisions, he added.

The PM regretted that politics of protests was putting a negative impact and those involved in it were not doing any service to the nation. "Those engaged in the sit-ins would be responsible for any delay in the completion of the power projects," Nawaz said while referring to postponement of the visit of the Chinese President.

Talking about the steps taken by the government to address the energy woes of the country, he said that government has given many incentives to the investors to invest in the alternate energy sector and at the same time advances were being made in hydel and nuclear power sectors.

During the meeting, Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi gave a presentation on the performance of his ministry and informed that the Petroleum Policy 2012 had been implemented. The minister said that 44 new exploration agreements had been signed and 137 oil wells had been spudded in the one year of their government, while during the last government's 5 years only 370 wells were spudded. Moreover, he said, during one year 37 oil and gas discoveries had been made while during PPP rule only 45 such discoveries were made.

He also apprised the meeting that the country was experiencing the highest oil production ever -- 9,898 bbl/day. The petroleum ministry is providing additional gas for fertilizer sector which had an impact of Rs30 billion. Another landmark achievement of the ministry is SSGC’s 400 MMCFD LNG terminal which would start working in February. This LNG terminal would provide gas to IPPs which would generate 2,500MW electricity, the minister added.

Abbasi told the cabinet that Gas Infrastructure Development Cess (GIDC) had been implemented. The cabinet came to know that Gas Theft (Control and Recovery) Act had been promulgated which would help save gas and generate revenue. The prime minister appreciated the 1,000MW gasfield on-site power generation policy.

The petroleum minister apprised the cabinet of the challenges and targets of the ministry in the next 3 years, which were implementation of Iran-Pakistan gas pipeline project, TAPI pipeline, South-North gas pipeline project, unbundling of SNGPL and SSGC and reduction of un-accounted-for gas to 7 percent.

The cabinet was told that two audit firms were hired to probe over-billing of electricity bills. In the initial reports the firm had pointed towards 31 percent increase in billing, 22 percent due to tariff increase last year and 9 percent due to increase in consumption.

Water and Power secretary proposed that the consumers using 300-500 units might be given relief of 22 billion rupees. The PM in this regard instructed to constitute a committee lead by the finance minister and comprising ministers of Water and Power, Interior and Petroleum as well as the Water and Power secretary. The PM ordered the proposed committee to provide immediate relief to the affectees.

Nawaz forms body to examine

power overbilling

The PML-N government on Friday constituted a committee to examine the issue of overbilling of electricity consumption, which will present its findings to the Cabinet on 6th November.

The committee, constituted by Prime Minister Nawaz Sharif, will also propose relief measures for domestic consumers (especially those belonging to lower and middle class).

The committee, headed by Finance Minister Ishaq Dar, comprises ministers including Ch. Nisar Ali Khan, Minister for Interior, Shahid Khaqan Abbasi, Minister for P&NR, Khwaja Muhammad Asif, Minister for Water & Power, Mohammad Younus Dagha, Secretary W&P.

The committee will work out whether the reduction of Rs. 65 billion in circular debt was actually the result of recovery of arrears/receivables or was it because of over-billing.

“Is the relief package proposed by the Secretary Water & Power practicable? Or should some more practicable package, to be worked out by the committee, be adopted,” the committee will examine these issues.