Prime Minister Shehbaz Sharif announced a Petrol relief package for low-income individuals who will receive a petroleum subsidy of Rs. 50 per liter.
The Petrol relief package incentive is available to owners of motorbikes, rickshaws, 800cc cars, and other small vehicles.
During a meeting to review the relief package, the premier highlighted that the program would soon be implemented and that a comprehensive strategy would be developed in collaboration with the relevant departments to ensure its effectiveness.
He stated that the subsidies would benefit those in need because low-income individuals often utilize motorcycles, rickshaws, and compact automobiles.
The prime minister highlighted that despite the difficulties of the economy, the government remains dedicated to assisting the disadvantaged.
In the review meeting were Muhammad Ishaq Dar, the finance minister; Ahad Cheema; Tariq Bajwa, the finance secretary; the petroleum secretary; and other top officials.
Minister of State for Petroleum Musadik Malik presented a summary of the subsidy plan to the audience.
According to an earlier story in The Express Tribune, the government was preparing an Rs120 billion cross-subsidy plan to assist the poor who own motorcycles but cannot afford the prohibitively costly fuel.
According to a report from The Express Tribune, the government plans to increase the price of gasoline by Rs. 15 for the wealthy, who drive luxury vehicles, to pay for fuel subsidies for the poor. However, PM Shehbaz has tasked Musadik Malik with developing a mechanism to provide reduced gas to low-income motorcycle owners.
When the premier asked for specifics during a recent cabinet meeting, the state minister responded that multiple discussions had been held and a cross-subsidy system had been developed.
According to sources, it was revealed at the talks that a total cross-subsidy of Rs120 billion would be required to provide cheaper gas for motorbike drivers. The owners of expensive vehicles would finance cross-subsidization.
The sources indicate that the plan’s implementation will likely be difficult. The fact that half of the nation’s 6 million motorcycles are on the road illegally is one of the obstacles.
The completed plan of the state’s minister of petroleum says that motorcycles must be registered to qualify for the cross-subsidy. In addition, bicycles must be connected to the State Bank of Pakistan to acquire a one-time password (OTP) and discounted gasoline pricing from filling stations (SBP).
Moreover, Benazir Income Support Programme (BISP)-eligible and registered bicycle owners would receive the subsidy.
Yet, neither the majority of motorbike owners nor those registered with the BISP have digital bank access. These issues worry policymakers because they believe the planned program may fail.
However, there are concerns that gas stations, many of which have engaged in fuel hoarding, would not pass on the full benefits of the cross-subsidy to motorbike owners and may increase their costs.
