Minister of State for Petroleum Dr Musadik Malik on Friday rejected Pakistan Tehreek-e- Insaf (PTI) claims that the party had been in the process of purchasing oil from Russia at a discounted rate when it was in power. He said the incumbent government found no evidence of this.

“Where is the government-to-government agreement or a memorandum of understanding which showed that Pakistan and Russia agreed on oil purchase?” asked Malik while addressing a news conference in Islamabad.

The minister said that former Prime Minister Imran Khan took wrong decisions which brought the country to the brink of bankruptcy.

The statement comes after the government on Thursday night announced an increase in the prices of petroleum products by Rs30 per litre.

Finance Minister Miftah Ismail expressed hope that reaching an understanding on staff-level agreement with the International Monetary Fund (IMF) would now be easier as constructive discussions are being held with the Fund.

However, PTI leader and former energy minister Hammad Azhar slammed the incumbent government’s decision, saying that Russia was keen to supply oil at discounted rates.

“(Finance Minister) Miftah Ismail is claiming on national television that no letter or proof exists of Russian oil talks… Russia was enthusiastic on selling discounted oil to us and he should have spoken to the Energy Minister of Russia,” said Azhar in a tweet, while sharing a letter he had apparently written to the Russian Energy Minister in this regard.

Talking about the letter, the federal minister said that to date the government has not received an answer from Russia.

Meanwhile, Malik criticised the past government for announcing subsidies on fuel, saying that no funds were allocated by the then government in this regard. “The federal government was bearing a loss of Rs120 billion on a monthly basis, due to the petroleum subsidy announced by the past government,” said the minister adding that the subsidy cumulatively adds up to Rs360 billion for three months.

He said that the government took time to remove the subsidy on petroleum products until a procedure was prepared, to safeguard the concerns of lower-income segments. “The poverty-stricken masses will be safeguarded from the petroleum price hike through a procedure which will be announced soon by Prime Minister Shehbaz Sharif himself,” he said.

The minister said that despite the latest hike, the price of petroleum products is still cheaper compared to neighbouring India.

“In India petrol is being currently sold at PKR250.17 per litre, in comparison to PKR179.86. Whereas, diesel rate in India is available at PKR234.3 per litre as compared to PKR174.15 in Pakistan,” he said, adding that the government is charging zero in central excise duty or levy on petroleum products.

Musadik expressed confidence that the government would soon be able to revive the stalled IMF programme, which would stabilise the country’s economy.

He said that the government’s decisions had also boosted investor confidence, as Pakistani equities and currency markets both staged recoveries.

This article was originally published in Business Recorder on May 27, 2022.