Islamabad, April 3 (IANS) Had Pakistan implemented governance and fiscal reforms it might have been better placed to protect its people against rising global oil prices today, “just as India has done next door”, said a leading daily.
An editorial in the Dawn Tuesday said the latest increase in domestic petroleum prices announced Saturday, to stay abreast of global trends, has pushed the government into “a very tight corner”.
“If it withdraws the increase, partially or completely, as demanded by all and sundry, it will have to deal with serious financial repercussions. The budget deficit is already being projected to rise to seven percent of GDP. If it does not, it will still face grave political consequences at a time when the next election is just around the corner.
“People burdened by years of high inflation and led by the opposition are already on the streets in many places protesting growing shortages of electricity and its soaring prices,” it said.
The daily said the oil price hike has “further fuelled public anger against the government, and not without justification”.
“It had already increased the people’s cost of living – transportation and food have become more expensive and the cost of healthcare, education and housing is set to surge further. More people will slide below the poverty line as real incomes stagnate or fall,” the editorial added.
Stating that businessmen have threatened to shut down their factories because higher fuel prices will add to their costs and make their businesses uncompetitive internationally, the editorial noted that it is “impossible for anyone, even the staunchest of government apologists, to endorse the fuel price rise”.
Global oil prices are shooting up because of the US blockade of Iran imposed to force it to stop its nuclear programme and international prices are projected to surge further, possibly above the historic high of $145 a barrel reached in July 2008.
It went on to say that “global oil prices are not solely responsible for the pain of the ordinary people. The government must accept its share of the blame in mismanaging the economy”.
“Its failure to broaden the tax net and restructure public-sector enterprises, for example, is largely to blame for the widening budget deficit. Had it implemented governance and fiscal reforms it might have been better placed to protect the people against rising global oil prices today, just as India has done next door,” the editorial said.
