Pakistan announces record rise in fuel prices, economy contracts

The move comes two weeks ater Islamabad said its GDP in the outgoing fiscal year ending on June 30 would shrink by 0.4%, instead of an initially projected 2.4% growth

Pakistan has announced a record increase in fuel prices days before the end of a fiscal year in which the country’s economy contracted for the first time in 68 years as a result of the coronavirus pandemic.

The hike, which ranges from 27 per cent to 66 per cent depending on the petroleum product, was announced on Friday night. It drew nationwide condemnation from people on social media on Saturday.

The move comes two weeks after Islamabad said its GDP in the outgoing fiscal year ending on June 30 will shrink by 0.4 per cent, instead of an initially projected 2.4 per cent growth.

Pakistan’s economy has witnessed a steady decline since 2018, when Prime Minister Imran Khan’s government came into power.

Its economy has been affected by the coronavirus since March, when Khan put the country under lockdown. Restrictions were eased in May, causing a spike in coronavirus infections and deaths.

Pakistan has confirmed 198,883 virus cases, including 4,035 deaths.

The Rs7.13 trillion tax-free deficit federal budget was presented in the National Assembly on June 12, 2020, with its major portions allocated for debt servicing and defence.