The government revised the prices of petroleum products on Sunday. Petrol is now going to be sold at Rs81.53, which is a Rs4.6 per litre increase from the previous price. Chairperson of Pakistan Peoples Party (PPP) Bilawal Bhutto Zardari was quick to comment on this price hike on the New Year and said that the government had dropped an inflation bomb on the nation. He accused the government of resorting to open rivalry and robbing the people of their due rights. While inflation is never good news for consumers, and an increase in prices always increases the burden on the consumers and impacts their day to day activities; such criticism coming from PPP was uncalled for and a gross exaggeration of the dynamics at play.
Inflation is not a policy that the government has made up on its own to rob the people, rather price hikes are a regular part of government’s policies and are done out of necessity. Consumers are also used to regular price fluctuations. And despite their complains, they understand the need for inflation as well. And a look at the international market explains the situation better. Prices are increasing in the international market as well. This means an automatic rise in prices in the domestic markets as well. However, if you still compare the rates of petroleum products in Pakistan with those of India, Bangladesh and Turkey; you will realise that the rates are relatively less to those compared in other countries.
Not increasing the prices in the country would increase the burden on the economy. And this decision came on the recommendation of Oil and Gas Regulatory Authority (OGRA). The government is trying to make the situation better by devising policies other than resorting to price hikes. One example of this is the subsidising of purchases, which is already in effect.
Hence demanding an arbitrary and completely unreasonable fifty percent slash to prices and threatening to launch protests if the government does not comply is an extremely impractical and nonsensical move by PPP. From an economic perspective as well, it does not make sense at all. Had the suggestions and demands of PPP been valid and applicable, the impact of their threat would have been more. At this point, it is just an attempt of political point scoring based on invalid and inaccurate statements.