How much money federal government will generate with increase in gas prices?
ISLAMABAD - Federal government will generate Rs 58 billion with the increase in the Gas Prices.
Government had increased natural gas prices by up to 20 percent, Petroleum Minister Chaudhry Mohammad Sarwar said, in effect slashing consumer subsidies that were a fiscal drag on the government’s budget.
Sarwar said the move would help ease part of the 152 billion-rupee ($1.24 billion) deficit for state-owned Sui Northern and Sui Southern, the two main suppliers of natural gas that are bleeding cash and subsidizing consumers and industries.
The decision was taken by the Economic Coordination Committee chaired by new Prime Minister Imran Khan, who has vowed radical economic reforms.
“It was a tough decision for us to take,” Sarwar said, adding that the price hike was “10 to 20 percent”, depending on how much gas the user consumed.
The new measures would inject “58 billion rupees to stabilize the two companies”, Sarwar added.