KARACHI: The Pakistan Business Forum (PBF) has warned that surging fuel prices could jeopardise the wheat harvest and deepen inflationary pressures, as it called on the government to scrap key levies and provide immediate relief to businesses and consumers.
The forum said the recent increase in petroleum prices, alongside a sharp rise in the petroleum levy to Rs160.61 per litre, was unjustified under current conditions and risked placing an excessive burden on the economy.
Ahmad Jawad, the PBF’s chief organiser, said higher diesel prices were already weighing heavily on the agricultural sector, making crop sowing increasingly unviable and raising the risk of losses during the wheat harvesting season.
The group also flagged what it described as a policy contradiction, noting that the government had signalled targeted subsidies only to impose measures that increased costs within hours. “Such steps cannot be termed fiscal discipline,” the forum said.
According to the PBF, petrol prices have risen by a cumulative 63 per cent over the past month, while diesel has surged by 75 per cent, intensifying cost pressures across the economy. It questioned whether taxpayers, who contributed more than Rs11 trillion in the previous fiscal year, should not receive relief during extraordinary circumstances.
The forum said authorities had fiscal space to cushion the shock, suggesting that development spending could be partially redirected towards fuel subsidies, while provinces could jointly extend support of up to Rs300 billion to the federal government.
It cautioned that the price increases would likely trigger a fresh wave of inflation, pushing up the cost of essential goods and prolonging pressure on household incomes. Jawad called for the immediate abolition of the petroleum levy, alongside a temporary waiver of import duty and carbon levy on diesel for at least one month. He also proposed reducing the general sales tax to 10 per cent for two months and suspending the monthly fuel price adjustment in electricity tariffs over the same period.
The forum dismissed proposals such as motorcycle subsidies as impractical, and instead suggested declaring weekly market holidays on Mondays and Fridays to ease pressure on traders. Pakistan’s income levels do not support the current fuel price regime, Jawad said, urging policymakers to prioritise relief measures over revenue generation during what he described as an exceptional period.
