Economists Against Oil & Petrol Price Hike

Group of emerging economists held a meeting in Karachi. They all come up with one decision, all seriously opposed the government move to increase oil prices in Pakistan at this time.

The Price Hike has already sparked an outcry from the political groups across the country but now the leading economists and business persons are speaking up against this move by the government for the first time.

"This hike is dangerous for Pakistani Rupee and the Economy" Zeeshan V, an emerging economist said in the meeting. "Fulfilling expenditures through central bank borrowing and not raising the oil prices has created a kind of equilibrium in the economy which was forcing Pakistani rupee not to go down despite heavy central bank borrowing, but now this would be reversible and would force Rupee to go down versus other currencies as oil price hike would force other commodities to rise" he added.

The country is already in economic turmoil as Pakistan Peoples Party government has failed to recover the economic cycle. Late last year, they have nearly lost its majority in parliament as allies threatened to leave the coalition amid oil price hike.

The ruling party backed off on the increase to save the coalition, upsetting international lenders whose billions are keeping the country's economy afloat.

Pakistan Fuel Price Hike Reversed

After severe opposition from other political parties including opposition and coalition partners, Government of Pakistan has announced withdrawal of the recent increase in prices of petroleum products.

Several Economists and the IMF has called this move a mistake and said that Pakistan has to undertake difficult economic reforms for long term economic stability. But they don't seem to understand that Pakistan is going through uncertain times and its a state in Emergency which need help from across the world.

The only solution to this problem seem to be Currency Appreciation versus US Dollar on emergency basis to bridge the gap from international prices. US can of course help Pakistan doing that as it has done with Afghanistan whose currency has appreciated after the US led war.

I am keeping my fingers Crossed!!