FPCCI demands govt slash petrol prices by 10pc

KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has demanded the government to slash prices of petroleum products by 10 percent in line with the drop in international rates, which would also ease inflation.

FPCCI President Irfan Iqbal Sheikh noted with a sigh of relief that oil prices were now under $100 per barrel, and the cut in petroleum prices would provide the much needed relief to the masses.

“The move will bring down the inflation in a much more effective and tangible manner than raising the interest rate to a 14-year high of 15 percent,” he added.

On July 7, the State Bank of Pakistan (SBP) increased its benchmark interest rate by a massive 125 basis points to 15 percent for the next four weeks. The rate hike came as the coalition government was trying hard to revive the much-awaited International Monetary Fund (IMF) for the resumption of a $6 billion loan programme that had been stalled since early April.

The FPCCI president emphasised that the full force of the multiplier effect of the raise of the petroleum products has not yet materialised in Pakistan and inflation would keep rising in the coming 2-4 weeks if the relief from the international market was not shifted to the end consumer.

FPCCI chief explained that global macroeconomic sentiments were not optimistic and growth forecasts have been significantly lowered to the tune of being recessionary; and, the phenomenon might drive the international oil prices even lower than $90 per barrel in coming weeks.

However, he maintained, “we have to tread a cautious path and gradually but progressively lower the domestic petroleum prices. Sheikh also put forward two of the supplemental concerns of the business community with regards to the petroleum prices. The first he said was reliable and uninterrupted supply of petroleum products in the backdrop of torrential rains across the length and breadth of the country.