Business leaders have warned that a sharp increase in petroleum prices could trigger a new wave of inflation, raising production and transportation costs and adding further pressure on Pakistan's fragile economy.
The president of the Islamabad Chamber of Commerce and Industry (ICCI), Sardar Tahir Mehmood, expressed strong concern over the Rs55-per-liter increase in petroleum prices, saying the decision would negatively affect trade and industry.
"Such a sharp increase in petroleum prices will directly raise production costs, transportation charges and overall operational expenses for businesses, making it increasingly difficult for industries and traders to sustain their activities," Mehmood said.
He added that Pakistan's economy is already facing multiple challenges and the latest fuel price hike could further aggravate the situation by pushing up prices of essential commodities and daily-use items.
Mehmood said placing the entire burden of rising international oil prices on consumers and businesses was "unjustified and unfair," urging the government to provide relief by reducing the petroleum levy and other taxes instead of passing the full impact of global price fluctuations to the public.
ICCI Senior Vice President Tahir Ayub said the industrial sector was already struggling with high energy costs and rising operational expenses, warning that continued increases in petroleum prices could lead to higher production costs, a slowdown in business activity, and possible job losses.
ICCI Vice President Irfan Chaudhry called on the government to adopt business-friendly policies, reduce the tax burden on petroleum products, and take practical measures to stabilize the economy.
Meanwhile, in Karachi, the president of the S.I.T.E. Association of Industry (SAI), Abdul Rehman Fudda, also voiced concern over the extraordinary increase in petroleum, oil and lubricant (POL) prices.
Fudda urged the government to immediately reduce taxes on petroleum products and absorb the impact of rising international oil prices instead of transferring the entire burden to consumers.
"In the present emergency situation, the government should absorb the impact of the increase in international POL prices by cutting petroleum taxes rather than passing the entire burden onto consumers," he said, warning that failure to provide tax relief would intensify inflation and economic pressure on industries and the public.
Fudda said higher fuel prices would increase transportation costs and raise the price of industrial inputs, making raw material procurement more expensive and affecting the competitiveness of several industries, particularly export-oriented units. He added that the price hike would also push up the cost of essential goods, increasing the overall cost of living and affecting low-income segments the most.
Fudda suggested that the government should also reduce fuel consumption by curtailing the fuel quotas of members of the national and provincial assemblies, as well as government officers, by at least 50%.
Both business groups urged the government to reconsider its policy and provide relief through reductions in petroleum taxes to help stabilize prices and support economic activity.
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