Economic Coordination Committee or ECC approved the hike in gas prices in Pakistan.
The gas prices in Pakistan will be increased by 190%. In addition, electricity prices in Pakistan will be also increased by Rs 1.5 per unit for the recovery of additional Rs 334 billion. However, the aim is to fulfill the demands of IMF or International Monetary Fund. The new rate will be effective from July 1.
It is the second time in this fiscal year that the Pakistan Tehreek-e-Insaf (PTI) government has increased prices of both electricity and gas. The maximum burden has been put on the middle and upper middle income groups whose disposable incomes have already shrunk due to increase in taxes and stagflation.
The government has reduced the average monthly gas bill of the richer person by 64% and the richest class by 19% by allowing them benefit of the last gas tariff slab. As part of the IMF condition, the State Bank of Pakistan (SBP) also devalued local currency to an all-time low of Rs161.5 to the US dollar in the inter-bank market on Wednesday. The currency depreciated by Rs4.5 in a single day.