Dr. Atif Mian, a highly respected economist from Pakistan who now lives in the United States, has called politicians and journalists who want lower gas prices in Pakistan “irresponsible and shortsighted” and explained why the prices must remain high.
He claimed that Pakistan was currently experiencing a severe balance of payments issue and that the only reason the exchange rate is currently stable is because the International Monetary Fund (IMF) had given its approval.This is not the time to be careless, according to Dr. Mian.
The economist stated that Pakistan “needs a meaningful strategy to move out of the recurring balance of payments crisis.”In order to balance the country’s current account, he explained, the price of gasoline must remain high; otherwise, significant problems could arise.
Additionally, he noted that Pakistan’s gasoline is currently 20% less expensive than India, its neighbour.A “real energy transition programme” must be implemented alongside the increase in gas prices, Dr. Mian continued.He gave an illustration by saying that the money generated by the high gas tax might be used to fund an energy transition strategy that involves solar energy, electric vehicles, and other forms of transportation.
