Terming the recent cut in POL prices as a peanut reduction, which will not give any real benefit to the common man, businessmen in a meeting at Islamabad Chamber of Commerce & Industry (ICCI) called upon the government to make a sufficient cut in POL prices in commensurate with the reduction of oil prices in international market to do justice with consumers and businesses.

Chairing the meeting, Zahid Maqbool, President ICCI said that government had given a severe blow to the economy by making more than 9 percent increase in POL prices which fueled unprecedented price hike in the country as according to Federal Department of Statistics (FDS), the inflation has surged by 13.6 percent across country during the month of January 2010 and this situation calls for at least five percent cut POL prices to provide some relief to poor people and to bring down the high cost of doing business.

He said that government was reportedly collecting about Rs.9.82 per litre general sales tax on petrol, Rs.11.98 per litre on HOBC, Rs.8.84 per litre on kerosene oil and Rs.8.42 per litre on LDO which was not fair at a time when businesses are in trouble and poor people are unable to make both ends to meet.

He demanded that tax on POL products should also be reduced to mitigate the sufferings of people and business. He said the price of crude oil has declined by 4.5 percent in the Gulf market as it was currently selling at $74 per barrel against $77.5 per barrel in January. Therefore, POL price should also have been reduced by more than 4 percent to pass on its full benefit to the consumers.

Businessmen said that due to hike in power & gas tariffs and POL prices, cost of doing business in the country has gone very high due to which productivity of industries is adversely affecting while Pakistan is losing export market to its competitors.

This is proved from the fact that country’s exports have witnessed a decline of 7.40 percent during July-November of the fiscal year 2009-10 while Large Scale Manufacturing during the first quarter (July-September) of current fiscal year have also registered a negative growth of 0.65 as compared with the same period of last fiscal year 2008-09.

They demanded that government should reduce energy cost by rationalizing the prices of electricity, gas and POL products. This will enable the private sector to steer the economy out of troubled waters by improving productivity and enhancing exports.