Pakistan government considers freezing petroleum product prices despite global increases
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View on mapNew PIA owners rattled by rising jet fuel costs, worry about sustainability
Chairman Pakistan International Airlines (PIA) Consortium Arif Habib on Sunday sounded the alarm over the sustainability of PIA operations in the wake of a recent 150 per cent hike in jet fuel rates, calling on the government to reverse the hike in prices. “PIA could be forced to shut down” if jet fuel prices continue to remain high, Habib warned in an interview aired on Bol News. Jet fuel (JP-1) rates have been increased without a formal announcement in recent weeks amid global supply chain uncertainty spurred by the US-Iran war. Official rates seen by Dawn suggest JP-1 prices were raised by Rs84 per litre, or 21.65pc, to Rs472 from Rs388 per litre with effect from March 21. Since March 1, the price has surged by nearly 150pc from Rs190 per litre. Habib connected the hike in jet fuel prices to the government’s subsidisation of the fiscal burden from rising oil prices on ordinary citizens, saying that the government had decided to raise the price of high-octane fuel and aviation fuel to raise money for a cross-subsidy. “In Pakistan, the government has raised prices but not in line with global markets. It seems like the government is trying to bear some burden from the savings it has made from the austerity measures and some through the cross-subsidy,” he explained. Last week, Finance Minister Muhammad Aurangzeb said that “targeted relief” would allow the benefits of fuel subsidies to be passed onto the deserving. He noted that the government had taken on a burden of Rs69 billion “using our own fiscal resources”. Habib was of the opinion that the government’s measures were “not sustainable”, adding that the government “has to take some steps to transfer some parts of this burden”. “On increasing the price of aviation fuel, I consider that it is a misunderstanding by the government that the common man doesn’t use aviation,” Habib said. The businessman said that PIA had “somehow” made it through the month but moving forward the ‘unsustainable’ hike would “make it difficult for PIA to operate” He believed that if the government did not take back its decision, PIA would “not be able to continue its operations”. “It will be forced to close,” he added. According to aviation experts, fuel accounts for 30-40pc of airline operating expenses. The significant increase in fuel prices due to the war has forced airlines to raise fares by 20-30pc. Domestic ticket prices have increased by Rs10,000-15,000, while international fares have spiked by Rs30,000-40,000. Further increases are likely if global oil prices continue to rise. “I don’t think that increasing the prices by that much will allow aviation to remain affordable for the people. And at the international level, these airlines will not remain competitive either, because for international airlines, jet fuel is not as expensive as it is in Pakistan.”
DawnMarch 29, 2026 at 12:39 PM UTCPIA could be ‘forced to shut down’ due to 150pc jet fuel rate hikes: Arif Habib
Chairman Pakistan International Airlines (PIA) Consortium Arif Habib on Sunday sounded the alarm over the sustainability of PIA operations in the wake of a recent 150 per cent hike in jet fuel rates. “PIA could be forced to shut down” if jet fuel prices continue to remain high, Habib warned in an interview clip shared by Bol News. Jet fuel (JP-1) rates have been increased without a formal announcement in recent weeks amid global supply chain uncertainty spurred by the US-Iran war. Official rates seen by Dawn suggest JP-1 prices were raised by Rs84 per litre, or 21.65pc, to Rs472 from Rs388 per litre with effect from March 21. Since March 1, the price has surged by nearly 150pc from Rs190 per litre. Habib said the national flag carrier had “somehow” made it through the month but moving forward the ‘unsustainable’ hike would “make it difficult for PIA to operate” He believed that if the government did not take back its decision, PIA would “not be able to continue its operations”. “It will be forced to close,” he added. According to aviation experts, fuel accounts for 30-40pc of airline operating expenses. The significant increase in fuel prices due to the war has forced airlines to raise fares by 20-30pc. Domestic ticket prices have increased by Rs10,000-15,000, while international fares have spiked by Rs30,000-40,000. Further increases are likely if global oil prices continue to rise. Habib connected the hike in jet fuel prices to the government’s subsidisation of the financial burden on ordinary citizens, saying that the government had decided to raise the price of high-octane fuel and aviation fuel to raise money for a cross-subsidy. “In Pakistan, the government has raised prices but not as per the rise in the global markets. It seems like the government is trying to bear some burden from the savings it has made from the austerity measures and some through the cross-subsidy,” he explained. Last week, Finance Minister Muhammad Aurangzeb said that “targeted relief” would allow benefits of fuel subsidies to be passed onto the deserving. He noted that the government had taken on a burden of Rs69 billion “using our own fiscal resources”. Habib was of the opinion that the government’s measures were “not sustainable”, adding that the government “has to take some steps to transfer some parts of this burden”. “On increasing the price of aviation fuel, I consider that it is a misunderstanding by the government that the common man doesn’t use aviation,” Habib said. “I don’t think that increasing the prices that much will allow aviation to remain affordable for the people. And at the international level, these airlines would not remain competitive either, because for international airlines, jet fuel is not as expensive as it is in Pakistan.”
DawnMarch 29, 2026 at 12:01 PM UTCInfo ministry refutes reports of ‘complete lockdown’ on weekends as part of fuel-saving measures
The information ministry on Sunday refuted a notification about a “complete and comprehensive lockdown” across the country on weekends, stating it was fake. In a post on its “fact checker” account on X, the ministry shared the notification being circulated on social media, with “fake” over it. “Avoid sharing fake news and false posts. Be a responsible citizen and only trust verified sources,” the ministry said in its post. The undated fake notification falsely quoted Prime Minister Shehbaz Sharif as directing the enforcement of several additional measures in “view of the continuing Gulf oil crisis”. As per the document, a “complete and comprehensive lockdown throughout the country” was ordered for every Saturday and Sunday, starting from April 5 onwards. “The lockdown shall take effect every Saturday from 12:01am (00:01 hrs) and continue till 11:59pm (23:59 hrs) every Sunday,” the fake order read. Earlier this month, Prime Minister Shehbaz Sharif announced a host of austerity measures in view of the global oil crisis triggered by the US-Israel war on Iran, which has hiked local fuel prices. These included a 50 per cent cut in fuel allowance for official vehicles, with the exemption of operational vehicles such as ambulances and public buses, for the next two months. Moreover, 50pc staff were to work from home in the public sector, but those providing essential services were exempted. On Friday, contingency measures to address fiscal and external account pressures in case of a prolonged Middle East crisis and worsening global conditions were discussed at a consultative meeting presided over by Finance Minister Muhammad Aurangzeb. The measures also included potential lockdowns, as well as fuel rationing, extended holidays in educational institutions, reduced working days in the private sector, similar to the public sector and implementing a 50pc work-from-home policy across both sectors. However, no official confirmation has been made yet regarding any such plan. Earlier on Tuesday, Sindh Local Government Minister Nasir Shah also said that the provincial government was contemplating a smart lockdown as a fuel conservation measure. But during the meeting on Friday, representatives from Khyber Pakhtunkhwa reportedly opposed lockdown measures, warning they would cripple economic activity and disproportionately affect daily wage earners and private sector workers.
DawnMarch 29, 2026 at 11:49 AM UTCProvinces look to avoid fuel subsidy burden
• Punjab, Sindh favour passing global oil prices to consumers • National leadership dialogue planned on March 30-31 • Petrol, diesel consumption rises amid price freeze • Targeted subsidy proposed with 20-litre monthly cap for bikers • Contingency plans include rationing, lockdowns, reduced workdays • KP opposes lockdown, warns of impact on daily wage earners ISLAMABAD: Amid provincial reluctance to shoulder the fuel subsidy burden and growing calls to pass on rising international petroleum prices to consumers, a national leadership dialogue is being arranged early next week to develop an “all-inclusive” agenda on austerity and energy conservation. Background discussions with key stakeholders suggest the provinces expressed their inability on Friday to contribute about Rs200 billion sought by the Ministry of Finance to shield consumers across the country from further hikes in petroleum prices. Both Punjab and Sindh — the two largest provinces supposed to share more than Rs102bn and about Rs60bn, respectively — instead suggested passing global prices on to the domestic market to create a price signal for behavioural change. A senior government official said a national leadership dialogue was being convened on March 30 or 31, to be attended by the president, the prime minister, the four chief ministers and their teams, to build consensus on austerity and conservation measures and to deal with the crisis with minimal economic and social fallout. At a consultative meeting presided over by Finance Minister Muhammad Aurangzeb on petroleum products and pricing, provincial governments questioned why people should be expected to reduce fuel consumption if prices remained frozen through federal and provincial subsidies. This concern was reinforced when the Petroleum Division reported that fuel consumption in March so far had been significantly higher than in the same month last year. All four chief ministers were invited to the meeting, but only Sindh Chief Minister Murad Ali Shah attended, while other provinces were represented by ministers and secretaries. They were informed that the country was in a relatively comfortable position regarding fuel stocks and supplies until the third week of April, with additional cover secured for the April 25 to May 15 period. The Ministry of Finance informed provinces that the federal government had arranged a pool of about Rs160bn, including Rs100bn in development programme cuts and savings from austerity measures, but stressed that federal fiscal capacity had its limits. The provinces were asked to contribute Rs200bn collectively. Khyber Pakhtunkhwa and Balochistan were expected to contribute roughly Rs30bn and Rs20bn, respectively, but did not oppose the proposal outright, possibly in view of the firm stance taken by the larger provinces. The meeting also discussed a range of contingency measures to address fiscal and external account pressures in case of a prolonged Middle East crisis and worsening global conditions. These included fuel rationing, potential lockdowns, extended holidays in educational institutions, reduced working days in the private sector, similar to the public sector and implementing a 50pc work-from-home policy across both sectors. Each proposal, along with its financial implications and potential savings, was presented and deliberated. At least three provinces argued that since fuel supplies were not currently constrained, the real issue was pricing and the design of targeted subsidies. Khyber Pakhtunkhwa reportedly opposed lockdown measures, warning they would cripple economic activity and disproportionately affect daily wage earners and private sector workers. The Sindh chief minister emphasised the need to educate consumers and the public on conservation through effective pricing signals. Punjab’s secretary pointed out that the province had already spent over Rs100bn on flood relief and rehabilitation and was now being asked to contribute a similar amount towards fuel subsidies, while also maintaining a budget surplus under the IMF programme. Petroleum Minister Ali Pervaiz Malik and his team reported that diesel prices had increased by 5-6pc since last Friday, while petrol prices had declined by about 6pc. Except for Bangladesh, which is facing a run on fuel pumps, most oil-importing countries — and even some producers — have passed on higher prices to consumers. 20-litre cap Participants, however, agreed in principle to provide targeted subsidies for motorcyclists, capped at 20 litres per month, while higher-consumption users would pay market-based prices. This would be implemented through a mobile application-based quota system to ensure subsidies reach low-income groups and minimise leakages. Finance Minister Muhammad Aurangzeb, who presided over the high-level consultation, highlighted the need to promote responsible consumption behaviour and ensure policy responses remained fiscally prudent while maximising public relief. The session began with a detailed presentation by the Petroleum Division on the availability of petroleum products in the country, noting with satisfaction that supplies remained stable and adequate across the country. The Ministry of Information Technology also presented proposed technological solutions to support a targeted subsidy mechanism, focusing on transparency and efficient delivery. Provincial leadership shared their perspectives on the evolving situation. Punjab Senior Minister Marriyum Aurangzeb emphasised the need to develop multiple policy scenarios in response to changing petroleum prices. She said any reduction in international prices should be passed on to consumers. Khyber Pakhtunkhwa Finance Minister Muzzammil Aslam commended the efforts of Mr Aurangzeb and Mr Malik in managing oil supplies, noting that Pakistan’s situation remained comparatively better than several countries in the region. How app-based system works The proposed mobile application-based quota system for fuel distribution envisages a fully automated mechanism for both consumers and retail operators. According to a senior government official, a free, pre-installed application will be provided to retailers, while consumers will use a separate app. Each fuel station will be required to maintain at least two mobile devices for system operations. The Ministry of Information Technology is coordinating with mobile manufacturers to supply specialised devices, with an estimated cost of Rs36,000 per unit and a retail price of around Rs72,000. Petrol stations have been asked to deposit funds into a designated government account for the timely procurement of these devices. Explaining the quota mechanism, an official said vehicle-based quotas would be linked to the user’s app through the vehicle registration number and their Computerised National Identity Card (CNIC). Final quota limits, however, will be determined by the relevant cabinet committee. Users will generate a digital voucher through the app, which retailers will scan or enter into the system. The system will automatically validate the available quota — for instance, if a user requests 20 litres but has a 15-litre quota, only 15 litres will be dispensed. . Procurement of 24,000 phones Meanwhile, the Ministry of Information Technology and Telecommunication has also invited expressions of interest (EOI) for the procurement of 24,000 mobile phones to support the petrol subsidy app. The devices will be deployed across around 12,000 petrol pumps, with two nozzles at each pump designated for subsidised fuel distribution. The EOI has been floated by the National Information Technology Board. An official notice stated that the initiative aims to assess indicative pricing and availability of Android smartphones before initiating formal procurement. The required devices must be brand new, PTA-approved and accompanied by a one-year official warranty along with mandatory after-sales support within Pakistan. Kalbe Ali also contributed to this report Published in Dawn, March 28th, 2026
DawnMarch 28, 2026 at 02:26 AM UTCPM Shehbaz again rejects increase in petrol, diesel prices
Prime Minister Shehbaz Sharif announced on Friday that he had rejected another recommendation for an increase in the prices of petrol and high-speed diesel (HSD). He made the announcement during an address to the nation, saying that he had been recommended to approve an increase of Rs95 per litre in the price of petrol and Rs203 per litre in that of HSD. “However, I have rejected it,” he said. The announcement comes a week after he said he rejected an increase of Rs76 per litre in the price of petrol Rs177 per litre in that of HSD. In the same instance, the premier had also said that he had rejected a similar recommendation earlier as well, following a hike in oil prices in the international market on March 13. The developments take place amid a global fuel crisis resulting from the US-Israeli war on Iran, which began on February 28. The government announced unprecedented austerity measures on March 9 and also hiked petroleum products’ prices earlier this month in the first steps to deal with the situation. Moreover, the Centre and the provinces also agreed today to immediately roll out a mobile application-based quota system for the provision of fuel for two- and three-wheelers to ensure a targeted subsidy for the low-income strata and minimise the leakage of public money into untargeted avenues. In this context, PM Shehbaz said in his address today that the world was currently facing an “extraordinary and extremely challenging situation”, in which even big economies were helpless. “Even developed countries, which have resources in abundance, are facing an extreme economic crisis,” he said, adding that the potential impact of this economic crisis was not difficult to assess. But, he said, “we had been preparing beforehand to deal with this storm. We immediately took decisions that were not easy to take”. The premier said a cut of Rs100 billion in the development budget and austerity measures had allowed the government to reduce the economic burden on the people. “It must be clear to you that today, every litre of petrol that is filled in your vehicle reflects the government’s policy of austerity and its realisation of responsibility,” he said. PM Shehbaz said it had been recommended to him to approve an increase of Rs95 per litre in the price of petrol and Rs203 per litre in the price of HSD for the week starting today. “But, I rejected it once again, considering difficulties, and the federal government has once again decided to bear this burden,” he said. The premier reiterated that the federal government would bear the burden of Rs56bn this week so that the people did not have to bear it. He said that keeping in view the fuel prices in the international market, the price of petrol in Pakistan should presently be Rs544 per litre. “But you are getting it for just Rs322,” he said. Similarly, he said, the price of HSD should have been Rs790 per litre, “but the government is providing it to you for just Rs335 per litre so that your burden and difficulties don’t increase”. He said these figures may seem mere numbers, “but the government has borne the historic burden of Rs125bn over a period of three weeks so that you don’t have to bear it”. PM Shehbaz said this amount could have been utilised for several development projects. “But at this point, nothing is more important to me than your economic security,” he said. He urged the people to bring a “revolutionary change” in their daily lives. “Think before travelling whether it is necessary; whether it is necessary to travel in a car or on a motorcycle every time.” He said the austerity was not an option anymore but a collective responsibility. PM Shehbaz said while long queues for fuel and skyrocketing prices were seen in other countries, his government had taken timely and effective measures to cushion the effects of the “storm of inflation”. “But the government cannot do this alone. I cannot do this alone. I request that you fully cooperate regarding a comprehensive plan that we are devising to deal with this challenging situation,” he said, adding that the plan would be announced in the coming days. Diplomatic efforts The premier began his address by speaking about Pakistan’s efforts for the restoration of peace in the Middle East through diplomacy. “Pakistan is making sincere and full-fledged mediatory efforts on the diplomatic front for an end to this war, so that the region and brotherly Muslim countries no longer face the destructive and negative consequences of this war,” he said. The PM further said the purpose of these efforts was to pave the way for lasting peace through “collective wisdom and consultation”. “Pakistan’s diplomatic efforts are not merely an international diplomatic responsibility, but they are also purely for the will of Gold and the benefit of ummah,” he said. PM Shehbaz said irrespective of “which school of thought sect we belong to, as Muslims, we all wish for peace”. In this context, he continued, he had detailed discussions with the heads of Iran and Gulf countries multiple times. Moreover, Deputy Prime Minister and Foreign Ishaq Dar had also been working for the restoration of peace while Chief of Defence Forces and Chief of Army Staff Field Marshal Asim Munir was playing an “active and key role” for the success of this process of rapprochement, he added. “I appeal to you to pray for the fruition of these efforts,” the PM said.
DawnMarch 27, 2026 at 05:33 PM UTCCentre, provinces agree on rolling out app-based fuel quota system for motorcycles, rickshaws
ISLAMABAD: The Centre and the provinces on Friday agreed to immediately roll out a mobile application-based quota system for the provision of fuel for two- and three-wheelers to ensure a targeted subsidy for the low-income strata and minimise the leakage of public money into untargeted avenues. “The participants agreed to expedite efforts to finalise a targeted subsidy framework using technological solutions, while ensuring continued coordination between the federal and provincial governments”, the Ministry of Finance said after a consultative meeting on the subject with the provinces. Finance Minister Muhammad Aurangzeb, who presided over a high-level consultative meeting on the petroleum products situation, also highlighted the need to “promote responsible consumption behaviour and ensure that policy responses remain fiscally prudent while maximising relief for the public”, the statement added. The meeting was also attended by officials from the provincial governments. The meeting commenced with a detailed presentation by the Petroleum Division on the current status of petroleum products’ availability in the country. It was noted with satisfaction that the fuel supply situation remained stable and adequate across the country, it said. The Ministry of Information Technology and Telecommunication also gave a comprehensive presentation on proposed technological solutions to facilitate a targeted subsidy mechanism for petroleum products, with a focus on transparency and efficient delivery, it added. The provincial leadership shared their views on the prevailing situation and policy options. Sindh Chief Minister Murad Ali Shah appreciated the federal government’s efforts to maintain uninterrupted fuel availability, while emphasising the importance of behavioural measures to promote fuel conservation, the statement said. Punjab Senior Minister Marriyum Aurangzeb, meanwhile, emphasised the need to develop multiple policy scenarios in response to the evolving petroleum price situation. She stressed that any reduction in international petroleum prices should be effectively passed on to consumers and highlighted the importance of incorporating behavioural aspects into crisis management to ensure more sustainable consumption patterns. Khyber Pakhtunkhwa Finance Minister Muzzammil Aslam lauded the efforts of Aurangzeb and Petroleum Minister Ali Pervaiz Malik in effectively managing the oil supply situation. He noted that Pakistan’s management of petroleum supplies had remained comparatively better than that of several countries in the region, the statement said. According to the handout, the Finance Division briefed the participants on the fiscal situation and noted that limited fiscal space was available, primarily confined to revenues from the petroleum levy. It was emphasised that any relief measures would need to be carefully calibrated to maintain macroeconomic stability. In his remarks, Aurangzeb underscored that the current situation should be treated as an opportunity to undertake structural reforms rather than a constraint. He emphasised the importance of adopting data-driven decision-making, particularly in the areas of taxation and subsidy design, to ensure transparency, efficiency, and better targeting of relief. Balochistan Minister for Finance and Mines and Mineral Development Mir Shoaib Nosherwani, the chief secretaries of all four provinces, the petroleum minister, IT Minister Shaza Fatima Khawaja were among those who attended the meeting. It is worth mentioning that sources told Dawn that the Centre is asking provincial governments to share the additional cost of higher international prices in a bid to avoid a domestic hike in prices of essential petroleum products. Insiders say the federal government is reaching out to the provinces, particularly Punjab and Sindh, to shoulder the fiscal burden it had been extending to the people across the country by maintaining petrol and diesel rates amid the US-Israeli war on Iran. These demands have been extended to the provinces in personal interactions and telephonic contacts by the prime minister himself, as well as other cabinet members, a senior government official said. How will the app-based system work? The plan for using a mobile application-based quota system for fuel distribution involves a fully automated system for both consumers and retail operators. According to a senior government official, a free, pre-installed app will be provided to retailers, while consumers will use a separate application. He added that each fuel station will be required to maintain at least two mobile devices for system operation. The Ministry of IT is coordinating with mobile manufacturers to supply specialised devices, with an estimated cost of Rs36,000 per unit and retail pricing around Rs72,000. Petrol stations have been asked to deposit funds into a designated government account for the timely procurement of these devices, with account details to be shared by the Oil and Gas Regulatory Authority (Ogra). Talking about the quota mechanism and vouchers, an official said vehicle-based quotas will be linked to the user’s app via a registration number and their Computerised National Identity Card (CNIC). However, quota limits will be decided by the relevant cabinet committee. The users will generate a digital voucher through the app, while the retailers will scan or enter the voucher, leading the system to automatically validate the available quota. For example, if a user requests 20 litres but has a 15-litre quota, only 15 litres will be dispensed. The official said the mechanism was similar to the previously successful Ramazan Package model. On the financial-pricing side, the government will be providing subsidies for two- and three-wheelers. Retailers and petrol stations will be required to dedicate specific dispensers or nozzles for these vehicles to facilitate subsidised fuel distribution. All oil marketing companies (OMCs) will also be required to appoint focal persons for each retail site for seamless operations of the scheme and provide their contact details to Ogra for round-the-clock monitoring of the scheme to address consumer complaints. The details of focal persons — including their name, mobile phone numbers and CNIC — will also be available to Ogra. For implementation and oversight, the details of retailers’ focal persons and contact numbers will also be provided to OMCs and the petroleum division. The IT ministry will provide demos and video tutorials on how to operate the system. In case of emergencies, a dispensation system will be made available for approvals through a designated process.
DawnMarch 27, 2026 at 12:01 PM UTCTargeted relief
THE latest proposal to introduce a mobile app-based fuel quota system, targeting subsidies for low-income users of two- and three-wheelers, is a positive attempt by the government to protect the poor against surging oil prices. It promises efficiency through digital vouchers, real-time quota tracking and automated validation at petrol pumps. Fuel subsidies, if indiscriminate, largely benefit those who consume the most — usually higher-income households. Low- and middle-income citizens, reliant on two- and three-wheelers, receive little benefit. This strains the national exchequer and weakens social equity. With volatile global oil prices, unfocused relief risks becoming a costly populist gesture rather than meaningful support for the needy. Targeted relief through mobile apps can ensure that subsidies reach those who truly need them. By linking fuel entitlements to verified income brackets, the government can shield the poor from price shocks without subsidising the affluent. This approach also signals that state resources are allocated on the basis of need rather than privilege. Moreover, the principle of targeting is critical for fiscal discipline. Every rupee spent inefficiently on subsidies is a rupee that cannot fund essential services such as healthcare and education. In times of economic stress, ensuring that public money serves the maximum social good is both prudent and a state obligation. While uncertainty in global energy markets deepens over the ongoing stalemate between the US and Iran, the benchmark crude and petroleum rates continue to fluctuate daily in response to speculation on diplomacy. These swings, however, are largely superficial; the underlying supply risks remain acute as attacks on oil infrastructure in the Gulf and Strait of Hormuz’s closure have forced key producers to cut output. Domestic policy cannot escape this global shock. The cost of maintaining fuel subsidies — whether through direct government outlays, provincial participation or indirect costs passed on to consumers — is immense. Already, some Rs70bn has been spent in just two weeks to keep petrol and diesel rates unchanged, necessitating a Rs100bn cut in the development budget. Earlier austerity directives, including reductions in discretionary spending and energy conservation, were meant to create fiscal space. But the current surge in global prices shows that the burden of energy shocks ultimately falls on public finances and, indirectly, the consumers. As Pakistan navigates global energy volatility and domestic economic challenges, targeted fuel relief is not just a technical solution but also a test of fair governance and social responsibility. Policymakers must resist populist pressure to offer indiscriminate subsidies, and instead, take steps that protect the poor, promote equity and preserve the state’s ability to meet broader developmental needs. Only by ensuring that relief reaches those who deserve it can we maintain both fiscal stability and social justice in these times. Published in Dawn, March 27th, 2026
DawnMarch 27, 2026 at 04:39 AM UTCECC approves Rs100bn supplementary grant for PM’s austerity fund
ISLAMABAD: The Economic Coordination Committee (ECC) on Thursday approved a Rs100 billion supplementary grant for the prime minister’s austerity fund created to finance the petroleum pricing subsidy. Finance Minister Muhammad Aurangzeb presided over the ECC meeting, which approved a summary submitted by the Ministry of Finance, seeking a Technical Supplementary Grant (TSG) of Rs100bn for onward transfer to the austerity fund. “The committee was informed that, in light of evolving developments in the Gulf region and their potential impact on international petroleum prices, the prime minister had directed the mobilisation of Public Sector Development Programme (PSDP) resources to meet price differential requirements on petroleum products and to cushion consumers from price volatility,” an official statement said. During the discussion, the ECC noted that the proposed allocation was being met through rationalisation and surrender of PSDP funds by various ministries and divisions, as coordinated by the Ministry of Planning, Development and Special Initiatives in consultation with Principal Accounting Officers of the ministries concerned, it added. It was emphasised that the reallocation exercise had been undertaken to minimise disruption to priority and well-performing projects while creating the required fiscal space. “The committee also took note that initial surrenders have already been received and the remaining adjustments were being finalised to meet the overall requirement. It was noted that PSDP had already been cut by Rs100bn to Rs900bn for the purpose,” the statement said. The government has already notified the crowdfunding of the opening of the Prime Minister’s Austerity Fund 2026 to mitigate the impact of the extraordinary spike in diesel and petrol prices due to the war in the Gulf region. All proceeds on account of the said fund would be received at all branches of the State Bank of Pakistan (SBP), all treasuries and branches of the National Bank of Pakistan and all other scheduled banks. The finance ministry has notified that the said fund would receive “donations from both domestic and international donors and contributions from abroad, which will be received at all the branches mentioned above where such branches exist”. In other foreign countries, contributions would be received at Pakistan missions and remitted to the SBP, which would prescribe the necessary procedure for its accounting, the notification said. “For this purpose, ten separate individual funds head of account, including special deposit fund, relief funds and Prime Minister’s Austerity Fund 2026, besides Prime Minister’s Austerity Funds for Punjab, Sindh, Khyber Pakhtunkhwa, Balochistan, Azad Jammu and Kashmir, Gilgit-Baltistan and the state-owned enterprises. “Accounts of the fund will be maintained by the accountant general of Pakistan revenues, Islamabad, the accountant generals concerned and the heads of state-owned enterprises. The fund will be administered by the Ministry of Finance,” the notification said. The ECC also approved the procurement of up to one million tonnes of wheat and directed that the procurement should be done through a transparent and competitive process to be executed by the private sector, the statement said. It added that the Ministry of National Food Security and Research had sought procurement of three million tonnes of wheat for federal strategic reserves under the Interim National Wheat Policy (INWP) 2025-26 through private-sector participation. The meeting was briefed about the current supply and demand outlook, including production estimates, evolving weather conditions, and existing public and private stock positions. Projections suggested improved crop conditions but uncertainties remain, warranting a cautious and calibrated approach to maintaining adequate reserves, the statement said. Furthermore, the ECC discussed the need to balance market stability, farmer support, and fiscal considerations, while avoiding premature interventions that could distort market signals or create uncertainty, it said. “The committee also highlighted the importance of distinguishing between strategic and commercial reserves, ensuring that procurement decisions are aligned with actual requirements and do not impose unnecessary fiscal or storage burdens. “Therefore, it decided procurement of only 1m tonnes and directed that key elements, including financial implications, pricing benchmarks, and operational modalities, be further refined in consultation with the Finance Division before finalisation,” the statement said The committee emphasised that procurement levels and financial commitments should remain flexible and responsive to updated crop assessments and market conditions, it concluded.
DawnMarch 26, 2026 at 05:11 PM UTCRequest for preferential energy cargoes will be ‘considered favourably’, Oman envoy assures petroleum minister
Oman’s envoy to Pakistan, Fahad Bin Sulaiman Bin Khalaf Alkharusi, assured Petroleum Minister Ali Pervaiz Malik on Thursday that Islamabad’s request for preferential energy cargoes would be “considered favourably”, a statement issued by the Petroleum Division said. The statement detailed the meeting between the two dignitaries in Islamabad, stating that Ambassador Alkharusi “welcomed Pakistan’s push towards diversification and conveyed that Oman stands ready to support Pakistan in enhancing its energy security”. “In this regard, the federal minister expressed optimism that Oman would consider Pakistan’s request for preferential energy cargoes to meet its growing requirements. The ambassador responded positively and assured that the request would be considered favourably,” it added. The statement said that the two discussed the evolving energy situation in the region and avenues for strengthening bilateral cooperation in the energy sector. “The federal minister highlighted that Pakistan and Oman enjoy long-standing, cordial and brotherly relations, rooted in shared history, mutual respect and strong people-to-people ties. He reaffirmed Pakistan’s commitment to further expand the bilateral energy partnership and explore new areas of collaboration,” it said. Moreover, the minister apprised the ambassador of Pakistan’s ongoing efforts to diversify its energy imports and ensure supply resilience, particularly by exploring alternative routes and sources outside the Strait of Hormuz in light of the changing regional dynamics, the statement said. According to the statement, three cargoes of petrol and one cargo of diesel were imported from the ports of Oman during March, and two more cargoes of petrol will be imported from Oman ports in the same month. The world has been facing a global fuel crunch in the aftermath of a US-Israeli war on Iran, which has been going on for nearly a month. The fuel crisis has resulted from the disruption of traffic in the Strait of Hormuz — a corridor that carries 20 per cent of global liquified natural gas and a quarter of seaborne oil. But last week, Malik said that despite the closure of the Strait, Saudi Arabia was “providing an uninterrupted supply of crude oil to Pakistan through the Red Sea, while the United Arab Emirates is also providing oil to us through Fujairah out of the Strait waterways”. Earlier this week, members of the committee formed to monitor petrol prices were told that cargo inflows were continuing as scheduled and petrol cargoes for the current month and for April had “largely been secured”, with additional shipments planned to further strengthen supply buffers. However, the government has warned that the situation could worsen if the conflict continues and has taken multiple steps in light of the situation, including a Rs55 per litre hike in the prices of petrol and high-speed diesel in early March and the adoption of austerity and fuel-conservation measures. During the meeting between Malik and Alkharusi, “it was noted that Pakistan State Oil and Oman Trading International are also engaged in constructive discussions to explore the possibility of additional oil cargoes to help meet Pakistan’s energy demand,” the Petroleum Division statement said. It added that opportunities for enhanced cooperation in the upstream sector, including exploration and production, were also discussed during the meeting while the importance of expanding collaboration in oil and gas development projects was also emphasised. “Both sides reaffirmed their shared commitment to further deepen Pakistan-Oman cooperation in the energy sector and strengthen strategic ties for mutual benefit,” the statement said.
DawnMarch 26, 2026 at 04:11 PM UTCHigh-level meeting chaired by president stresses national consensus, institutional coordination amid regional volatility
President Asif Ali Zardari on Thursday chaired a high-level meeting that stressed the importance of national consensus and institutional coordination in view of emerging regional challenges arising from the ongoing US-Israel war on Iran. According to a handout by the President’s Secretariat, President Zardari chaired the meeting at the Aiwan-i-Sadr in Islamabad. It was attended by Prime Minister Shehbaz Sharif and Chief of Defence Forces and Chief of Army Staff Field Marshal Asim Munir. According to the handout, the broader regional situation also came under discussion, including its implications for Pakistan’s security, economic outlook and food security. The meeting emphasised the need for a coordinated national response, noting that policy decisions must prioritise stability while safeguarding the interests of the public. “The meeting underscored the importance of maintaining national consensus and strengthening institutional coordination in view of emerging regional challenges. It was agreed that economic management, energy planning, food security and broader security considerations must remain closely aligned to meet this challenging situation,” the handout stated. It said the meeting reviewed the evolving economic and energy situation in the backdrop of oil supply constraints and hike in petroleum prices, alongside regional security developments. The meeting also reviewed the “impact of fluctuations in global oil and gas supplies and prices on Pakistan’s economy, with particular focus on managing inflationary pressures and ensuring energy security”, the handout said. “The ministers for finance and petroleum briefed the meeting on ongoing measures to stabilise petroleum prices, manage the effects of rising fuel costs on other sectors of the economy and enforce fiscal discipline through austerity measures to reduce expenditure pressures,” it added. The meeting also emphasised the need for public awareness to reduce fuel consumption, encourage the use of public transportation and promote shared ride systems.
DawnMarch 26, 2026 at 11:55 AM UTC