The federal government of Pakistan has given itself the power to raise the petroleum levy without any limit. A recent presidential ordinance issued by President Asif Ali Zardari removed all restrictions on the levy amount. Previously, there was a cap on the petroleum development levy (PDL) set at Rs 70 per litre.
With the abolishment of the Fifth Schedule, the government is now free to impose the levy at any rate it chooses. Sources indicate that the government previously faced legal limits on the PDL but can now increase it without constraints. This decision comes despite falling global oil prices, as the government chose not to pass those savings to the public.
As a result of the new ordinance, the levy on petrol has risen by Rs 8.02, bringing the total to Rs 78.02 per litre. Similarly, the diesel levy has increased by Rs 7.01, making the total Rs 77.01 per litre. Nevertheless, the Ministry of Finance announced that petroleum prices will remain unchanged for the next 15 days.
The government stated that it will allocate the savings from the recent decrease in global oil prices to important infrastructure projects. Prime Minister Shehbaz Sharif revealed that the funds will help dualize the critical N-25 Highway, connecting Chaman, Quetta, Kalat, Khuzdar, and Karachi.