Lahore, (Parliament Times) : The Pakistan Industrial and Traders Associations Front has rejected jump in prices of petroleum products for the second half of December 2020
despite the fact that Pakistan’s headline national inflation is still in high range
of over 8 per cent, warning the authorities that inflation above 6 percent could
hurt economic growth.
In a joint statement with vice chairman Javed Siddiqi, Mian Nauman Kabir
said that for the second half of Dec, the government increased the prices of
petrol by Rs3/litre, diesel Rs3.01/litre, kerosene by Rs5/litre and Light Diesel
Oil (LDO) increased by Rs2/litre. The increase will be effective from today
(Dec 16) till the end of the month.
Mian Nauman said that the high speed diesel is used mostly in the transport
and agriculture sectors. Therefore, any increase in its price will lead to
inflationary impact. Kerosene oil price has also gone up, which is used in
remote areas where liquefied petroleum gas is not available for cooking
purposes. So, any increase in its price will have an impact on the life of the
poor. The price of light diesel oil has also been hiked, which is used in
industries.
Mian Nauman Kabir said that oil prices and inflation are closely connected in a
cause-and-effect relationship. As fuel rates move up, inflation, which is the
measure of general price trends throughout the economy, follows in the same
direction upward. On the other hand, if the rates of fuel fall, inflationary
pressures start to drop. He urged the government to take concrete measures for
easing out inflation that has further increased due to rise in oil prices and other
essential commodities. He said that inflation is on higher side due to the impact
of government’s economic policies of soaring fuel rates, enhancing power and
gas tariff, depreciating the local currency and imposing exorbitant duties on
imported industry raw material.
PIAF vice chairman Javed Siddiqi called for putting the economy on a
balanced and sustainable growth trajectory, addressing the underlying
structural vulnerabilities, as low export growth, limited foreign exchange
reserves, documentation of economy and higher food inflation are still major
challenges to the economy.
Referring the data of Pakistan Bureau of Statistics, PIAF chairman said that the
SPI inflation increased by 9.9% annually in Nov 2020 as compared to increase
of 12.3% a month earlier and an increase of 20.2% in Nov 2019. On monthly basis, it increased by 1.1% in Nov 2020 as compared to increase of 3% a
month earlier and an increase of 3.7% in Nov 2019. The five-month inflation
was recorded at 8.76% against 10.8% in the corresponding period of the last
fiscal. During last financial year (July-June 2019/20), the average inflation was
recorded at 10.74%, with a peak reading in Jan of 14.56% year-on-year.
The latest CPI bulletin says that on a month-on-month basis, inflation
increased by 0.8% in Nov 2020 as compared to an increase of 1.7% in the
previous month and an increase of 1.3% in Nov 2019. He said that the CPI is a
main gauge of price changes at the retail level of all goods and services,
consumed by private households and roughly reflect changes in the cost of
living of whole country. He said that the inflation increased mainly due to
abnormal fuel price increase by the government.
PIAF vice chairman Javed Siddiqi said that the outcome of stabilization
policies, agriculture sector interventions, rigorous monitoring at federal and
provincial levels and favourable weather can bring in better results in easing
out inflation and sustain the economy towards growth and productivity.
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