Petroleum minister says IMF approval depends on replacing revenue lost from any levy cut
ISLAMABAD
Petroleum Minister Ali Pervaiz Malik has said any cut in the petroleum levy is unlikely to secure approval from the International Monetary Fund unless the government identifies an alternative revenue source to offset the loss. Briefing the Senate Standing Committee on Petroleum, Malik said the levy currently charged on petrol and diesel was already lower than the level imposed during wartime, adding that “perhaps the IMF may agree” if Pakistan developed another revenue option.
His remarks came as lawmakers challenged the government’s daily fuel pricing system, calling it a burden on consumers, while the minister defended it as a market-linked mechanism aimed at managing global price volatility. The committee, which met with Senator Umer Farooq in the chair, also took strict notice of the absence of performance audits of oil rigs and directed the relevant authorities to submit the audit report within seven days.
Malik told the committee that the government had eliminated political interference in fuel pricing by authorising Ogra to independently set petroleum prices through a transparent mechanism. Ogra chairman informed lawmakers that Pakistan’s petrol and diesel prices are linked to Singapore market benchmarks, not crude oil prices. He said the daily pricing mechanism would help cushion consumers from sudden shocks caused by international market fluctuations.
However, Senator Saifullah Abro criticised the mechanism, calling daily price revisions a “slow poison” and saying ordinary consumers could not understand the complex pricing formula. The committee also questioned delays in appointing a permanent Ogra chairman, with Malik saying the process was restarted after no suitable candidate was found earlier.
