ISLAMABAD - In order to protect masses from higher prices, the federal government has allocated Rs699 billion for the subsidies for the next fiscal year.
The federal government has increased the amount for subsidies by 2.5 percent to Rs699 billion in the budget for next fiscal year from Rs682 billion of the outgoing financial year. The government has allocated subsidy to protect people from the higher inflation rate, which is estimated at 11.5 percent in the next fiscal year.
The major portion of the subsidies would be given to the power sector. The government has allocated Rs570 billion for the power sector in FY2022-23 as compared to Rs596 billion of the outgoing year. In the power sector, the government would increase the subsidy amount to WAPDA/PEPCO to Rs275 billion for next year, which was Rs257 billion. Meanwhile, it would provide subsidy of Rs80 billon to KESC in year 2022-23 as against Rs85 billion in the outgoing year. In new addition, the government has allocated Rs215 billion for IPPs.
The government has enhanced the subsidy amount for petroleum to Rs71 billion for the year 2022-23 from Rs20 billion of the ongoing fiscal year. Subsidy on petroleum products has increased amid massive hike in its prices in international market. The government is still paying subsidy on oil products, as it is bearing Rs9 per liter subsidy on petrol, Rs23 per liter on high speed diesel and Rs8 per liter on light diesel oil.
Meanwhile, it has maintained the amount at Rs7 billion for Pakistan Agricultural Storage and Services Corporation (PASSCO).
The government has increased the subsidy amount to Rs17 billion for the Utility Stores Corporation (USC) from Rs6 billion. The government normally provide basic food commodities like wheat flour, sugar, ghee, oil and pulses at subsidise rates at state run USC. Prime Minister Shehbaz Sharif has decided to provide sugar at Rs70 per kg and wheat flour at Rs40 per kg at USC outlets during the current fiscal year to provide relief to the lower segment of the society. Similarly, the government every year announce relief package for the holy month of Ramazan by providing all basic food commodities at lower rates to the people.
According to the budget documents, the subsidy amount for wheat for Gilgit Baltistan (GB) has allocated Rs8 billion for the year 2022-23. Meanwhile, it has increased subsidy amount to Rs4 billion from one billion rupee for metro bus. The government has increased subsidy amount for fertilizer to Rs15 billion for the upcoming financial year from Rs1 billion. The government has also allocated Rs6 billion for the import of urea.
However, the coalition government has reduced the subsidy amount for the housing project announced by the previous government of PTI. The government has reduced the subsidy to Rs500 million for Naya Pakistan Housing Authority in next fiscal year, which was Rs30 billion in the outgoing year. Similarly, the subsidy to for mark-up subsidy on Naya Pakistan is Rs500 million, which was Rs3 billion in the outgoing fiscal year.