Web Desk: Federal government has approved the withdrawal of fuel subsidies previously granted to motorcyclists, public transport operators freight carriers and small scale farmers citing a sustained decline in global oil prices and lower domestic fuel costs.
The decision was made during a meeting of the National Steering Committee on Fuel Subsidies chaired by Deputy Prime Minister Ishaq Dar, according to officials familiar with the proceedings.
Following discussions, the committee endorsed the termination of subsidy programs covering motorcycles, rickshaws, small farmers, public transport operators and the goods transportation sector. The move will take effect after receiving final approval from Prime Minister Shehbaz Sharif.
Officials said international fuel prices have fallen considerably in recent months, allowing the government to pass the benefit of lower costs directly to consumers through domestic fuel pricing adjustments. As a result, policymakers concluded that targeted subsidy programs were no longer necessary.
Previously, motorcyclists, rickshaw drivers and owners of small vehicles with engine capacities of up to 800cc were receiving fuel subsidies ranging between Rs50 and Rs100 per litre.
Meanwhile, public transport operators and freight carriers were receiving monthly financial support of between Rs70,000 and Rs100,000 to help contain transportation costs and limit fare increases for passengers.
However, the withdrawal of subsidies could increase operating costs for transport operators and farmers if fuel prices rise again in the future. Industry stakeholders are expected to closely monitor the impact of the policy shift on transportation expenses, agricultural production costs and consumer prices.
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