Federal Finance Minister Miftah Ismail announced Saturday the process for the deserving families to avail the subsidies on petrol and diesel under the relief program announced by Prime Minister Shehbaz Sharif in his address to the nation Friday.
Addressing a press conference in Islamabad, the finance minister said families who are part of the Benazir Income Support Program (BISP) will automatically receive Rs2000 under the “Prime Minister Sasta Petrol Sasta Diesel Scheme.”
The households that are not part of the BISP database will have to send their identity cards numbers to 786 to check their eligibility, Ismail added.
However, he clarified that the id card number should belong to a woman as the money would only be transferred to the women head of the household.
Miftan said the government would verify the intending beneficiary and if their household income was found to be less than Rs40,000, they would get the money.
He said the subsidy amount was equal five percent of these families’ total income as according the the Pakistan Bureau of Statistics data, an average Pakistan spends five percent on transport.
He said the program was expected to benefit more tan 14m families, out of which 7.3million were already registered under BISP. “The remaining 6.7m families will have to send the message to 786 [to avail the subsidy].”
The finance minister said the subsidy would cost the government Rs28b, however, he refused to call it a “burden on exchequer.”
He said with the recent hike in the prices of petroleum products, the government has reduced the loss it was sustaining by subsidizing petroleum products by Rs60b.
Criticizing the former finance minister, Ismail said Sahukat Tarin committed to the International Monetary Fund (IMF) that there would be no subsidy on the petroleum products, in addition to Rs30 levy.
“The government was was losing Rs84 per litre on diesel. [If we] increase that and add Rs30 levy [as committed by Tarin], it comes to Rs114. [if we] Add this to the existing diesel price which is Rs144, the price should be Rs258. Add sales tax to it and it be around Rs300 and Rs260 for petrol.”
Replying to Tarin’s claim that the previous government left the money to finance the subsidy announced by former Prime Minister Imran Khan in February, Ismail said if if Tarin can tell where that money is, he will be happy to use it.
The truth is that he didn’t leave anything, said Ismail.
The finance minister also said that after the price hike on Thursday, the price of petroleum products will not be increased on June1.
The prices of petrol and diesel are revised fortnightly on first and 15th of every month. However, the government was compelled to increase it on May 26, after the IMF linked the release of the next tranche with the removal of subsidy on petroleum products.
Talking about the resumption of IMF loan program, the finance minister said the staff level was expected to be reached by June.
After the agreement, there would be a board meeting and subsequently, the money would be released, he added.
The finance minister said the money from the IMF was not needed to shore up the reserves, rather it was needed to secure funding from other multilateral sources.
He said the China would soon announce a monetary package, while the country also expects to receive support from Asian Development Bank, World Bank and Asian Infrastructure Development Bank.
The minister added that Saudi Arabia has already announced to roll over the $3b loan which the Gulf country has deposited in the central bank’s reserves.
The finance minister also announced that the budget for the fiscal year 2022/23 will be announced June 10.