New Delhi, Sep 18 (IANS): Pakistan has announced a new round of austerity measures including cut in fuel for official vehicles to cut government spending as petrol and diesel prices surge amid disruptions to Gulf supplies due to the West Asian conflict, as per multiple reports.
The measures include cuts to fuel allocations for official vehicles, a ban on state purchases of new vehicles, restrictions on foreign visits by officials and official dinners, according to multiple reports.
The austerity measures, announced for the second time this year, also included a ban on purchases of durable goods by state bodies except for IT equipment and ordered a shift to teleconferencing for meetings.
Pakistan had in March closed schools for two weeks, cut fuel use across government departments and pushed companies to offer more remote working to conserve energy.
The South Asian nation had also implemented a fuel subsidy of 100 Pakistani rupees a litre from Wednesday to owners of motorcycle, rickshaw and small-cars, on a capped monthly quota to ease the impact of rising prices
The Iran crisis and the UAE’s request for debt payback have severely affected Pakistan’s economy, which keeps on increasing its already heavy debt burden.
Further, the government’s growing defence spending has squeezed resources for health, education necessary for long-term steady growth.
Pakistan’s share of exports to GDP has fallen from around 16 per cent in the 1990s to about 10.4 per cent in 2024, while the debt-to-GDP ratio touched nearly 70 per cent.
The Gulf supplies to Pakistan were disrupted after Iran tightened its grip on the Strait of Hormuz on February 28, following Israel and the United States’ joint strikes on Iranian territory.
The navy of Iran’s Islamic Revolution Guard Corps (IRGC) said early Friday a “violating” oil tanker that sought “illegal” passage through the Strait of Hormuz was struck the previous night and brought to a halt.
