Pakistan: CNG price climbs to record Rs 300/kg; traders criticise govt over negligence

The price of Combined Natural Gas (CNG) in Pakistan has reached a new high of Rs 300 per kilogram, prompting the CNG Dealers Association to criticise the government for seeking to shut down the business and raising rates without consultation. This came as CNG rates in Pakistan rose following a Rs 70 boost, according to an ARY News report on Saturday. 

Further, CNG Dealers Association Chairman Abdul Sami Khan noted in a statement that the price of RLNG (Re-Gasified Liquefied Natural Gas) has also been raised. The chairman expressed his displeasure with the price rise, claiming that investments worth billions have been lost in the CNG industry. He went on to say that CNG was a cheap fuel, but that demand will be wiped away by the enormous price increase. The Chairman further urged that the federal government should give RLNG to the CNG industry at discounted prices, or the CNG industry should be phased out entirely, ANI reported.  

Shehbaz Sharif added Rs 30 billion to Pakistan's debt by refusing to accept a plan to raise oil and gas prices

In addition to this, earlier in the month of April, Pakistani Prime Minister Shehbaz Sharif added Rs.30 billion to the nation's debt by refusing to accept a plan to raise oil and gas prices. Sharif's action has substantially worsened the country's economic condition, which had already been suffering from an Rs.30 billion exchequer burden due to differential claims to keep oil prices stable from April 1 this year. According to media reports, to sustain the oil prices throughout April, Islamabad would have to pay oil firms a hefty Rs 60 billion. 

Pakistan's decision to maintain discounted petroleum product prices would cost the government Rs 40 billion till May 15, starting from May 1. According to the Dawn newspaper report, citing official sources, the Pakistan government chose to keep the rates of subsidised petroleum products steady for a fortnight up to May 15, although costs are expected to climb for the second fortnight of May. 

Apart from this, the meetings with the International Monetary Fund (IMF) starting on May 18 are important as Pakistan's economy remains stagnant. According to Finance Minister Miftah Ismail, the federal treasury suffers a monthly loss of 102 billion rupees due to petroleum products. Pakistan's finance minister added, “The government is bearing per litre 30 rupees loss on petroleum. However, the decision has not yet been taken to enhance the prices of petroleum products," ANI reported.  

Long-standing structural weaknesses in Pakistan's economy are driving away investors, exacerbated by global difficulties like the COVID-19 outbreak and the Ukraine-Russia war. Further, Pakistan's development momentum is unlikely to speed up in the near future, as a dramatic increase in import costs would have a negative influence on the Pakistani Rupee. One of the causes for this poor growth, according to World Bank research, is the banking sector's insufficiency. 

(Image: AP/ Pixabay)