Pakistan provides fuel subsidies to 9 million low-income people

The Pakistani government has been providing fuel subsidies since last month to about 9 million low-income people who are struggling with rising fuel prices due to the war between the United States and Iran.

According to the Associated Press on the 7th, the Pakistani government announced the day before that it had approved a fuel subsidy payment program for low-income people on the 14th of last month and had begun implementation.

Minister of Information and Technology Shaja Fatima Khawaja explained that the program is aimed at easing the burden on millions of people as global fuel prices rise due to geopolitical tensions in the region.

More than 9 million subsidy recipients receive a token based on eligibility requirements and present it at a gas station to receive a discount on the price of fuel used for livelihood transportation such as motorcycles.

The amount of the subsidy and the number of times it is received vary depending on the means of transportation.

Motorcycle and three-wheeler users benefit from a subsidy of 500 Pakistani rupees (about 2,400 won) per week with one token. They receive 4 tokens per month and receive support of up to 2,000 Pakistani rupees (about 9,700 won).

Additionally, vehicle owners with an engine displacement of up to 800cc or less can receive a discount of 100 Pakistani rupees (about 480 won) per liter on up to 10 liters (L) of gasoline every 10 days. Vehicle owners will receive a subsidy of up to 3,000 Pakistani rupees (about 14,500 won) in the form of three tokens per month.

This program is in response to the rise in international fuel prices due to the war between the United States and Iran that began in late February. In Pakistan, which imports most of its fuel, prices of gasoline and diesel have soared by more than 50% compared to the beginning of the year.

As a result, the cost of living related to transportation and food also increased significantly, further squeezing the low-income class and raising concerns about anti-government protests.

This program was approved by the government shortly after the Islamist political party Jamaat-e-Islami threatened to hold a protest march to the capital Islamabad.

The government approved a program to ensure that low-income people could purchase fuel at pre-war prices.

However, there are also voices of dissatisfaction among those eligible for the program.

Amir Shahzad, a resident of Islamabad, told the AP: “The subsidy will ease my commute, but if I want to travel to other cities, I will have to buy gasoline at high market prices.”

There are concerns that the implementation of this program will worsen financial difficulties for Pakistan, which has been bailed out more than 20 times since it first received bailout support from the International Monetary Fund (IMF) in 1958.

It has been reported that the IMF is requesting the Pakistani government to reduce government subsidies for some items, including wheat.