Web Desk: Federal government has decided to cut 100 billion rupees from its development budget instead of raising fuel prices, a move aimed at easing pressure on consumers and containing inflation, according to government sources.
Officials said the government moved to block a proposed increase in petroleum prices by adjusting fiscal priorities. Federal authorities had been considering raising petrol by 55 rupees per litre and diesel by 75 rupees per litre. However, they are now expected to keep prices unchanged.
As a result, consumers could see short-term relief at the pump if the decision is finalised.
To offset the revenue impact, the government has proposed reducing the current fiscal year’s development budget by 100 billion rupees. Consequently, the total allocation is likely to be revised down from 1,000 billion rupees to 900 billion rupees.
Moreover, federal government plans to cut funding for ongoing development projects by up to 10 percent. They say the adjustment will help manage the fiscal deficit while maintaining price stability for petroleum products.
Authorities intend to redirect the saved 100 billion rupees toward emergency relief and public welfare initiatives. In addition, the move is expected to cushion the public from rising living costs.
Earlier, the government had weighed a significant fuel price hike to manage fiscal pressures. However, it has now prioritised budget cuts as an alternative approach.
The decision could help slow inflation in the near term. At the same time, officials argue it will support efforts to keep the fiscal deficit under control.
Nevertheless, the reduction in development spending may raise concerns about delays in infrastructure and public sector projects.
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