LAHORE/ISLAMABAD - The business community has severely criticised bulk increase in petroleum products prices and said that caretaker government has implemented a bad decision of Oil & Gas Regulatory Authority (OGRA), which must be withdrawn immediately.

LCCI president Malik Tahir Javaid said that Oil & Gas Regulatory Authority (OGRA) is moving with closed eyes. “This body doesn’t care for economy, trade and industry and is continuously taking anti-businesses decisions,” he added. He said that government needs to care for economy that is in a bad position but it is a matter of concern that it has implemented the OGRA’s decision without taking stakeholders on board.

Why doesn’t OGRA suggest government to reduce duties and taxes on petroleum products besides cutting non-development expenditures of the state, he questioned?

On the other hand, Islamabad Chamber of Commerce and Industry called upon the caretaker government to withdraw its decision of making further hike in the prices of petroleum products as it would enhance the cost of production, increase inflation for the general public, affect exports and hit the growth of the economy.

Muhammad Naveed Malik, acting president of Islamabad Chamber of Commerce and Industry, said that the caretaker government has increased the price of petrol by Rs4.26 per litre, high speed diesel by Rs.6.55 per litre and kerosene by Rs.4.46 per litre at a time when the business community was already facing many challenges in promoting business activities.

He said that Pakistan was producing major chunk of electricity through oil fuel which has led to the high cost of production making Pakistani exports uncompetitive in the international market. He said that exports have recently witnessed a turnaround, but the recent hike in the price of petroleum products would make exportable products more uncompetitive in international market, leading to further slump in exports.

He said that the increase in the price of diesel would further enhance transportation cost that would affect the growth of business activities and give rise to inflation for the general public. He said the hike in POL prices would also affect agriculture sector as most of the tube wells were run on diesel and the cost of bringing the products from farms to markets would further go up.

Malik said that the government has imposed many taxes on POL products which was not justified. He said that government was receiving 27.5 percent GST on HSD and 17 percent GST on other POL products. In addition to that, it was charging Rs8 per litre on HSD as petroleum levy and Rs10 per litre on petrol.  He urged that instead of making any increase in POL prices, government should reduce heavy taxes and levies on these products that would bring down the high cost of doing business, facilitate growth of business activities and exports, reduce inflation and yield multiple benefits for the economy.

Meanwhile, Pakistan Industrial and Traders Associations Front (PIAF) also condemned the interim government for increasing prices of petroleum products by over Rs5 per liter in one jump, terming it bad news for the country’s economy, as this hike in fuel rates would lead to increasing cost of production.

PIAF chairman Irfan Iqbal Sheikh stated that it is unfortunate that the federal interim government has broken its promise of not increasing the oil prices.

Irfan Iqbal said though the prices of oil in global market are going up yet the authorities can keep the rates stable by reducing tax ratio which is highest in the region.

Khawaja Khawar Rashid and Zeshan Khalil, representatives of business community, said that government is producing huge amount of electricity through thermal means and after increase in petroleum prices, prices of electricity would touch new heights. They said that the Lahore Chamber of Commerce and Industry had for the last many years been calling on the concerned government circles to take measures for the promotion of alternate fuels as trade deficit was fast widening due to heavy imports under the head of petroleum products. The LCCI office-bearers demanded of the government to withdraw the increase in POL prices in the larger interest of trade, industry and economy.