High Fuel Prices Bad for Business: FPCCI

High fuel prices are negatively impacting Pakistan's export competitiveness and increasing business expenses, according to the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) President Atif Ikram Sheikh. Sheikh called for a more pragmatic approach to fuel pricing, particularly for high-speed diesel (HSD), suggesting that a reduction in diesel costs could alleviate burdens for various sectors including transport, agriculture, and manufacturing.

Sheikh argued that expensive diesel is driving up logistics and transportation expenses, exacerbating the costs of agricultural supply chains, and intensifying the pressure on businesses and consumers. He emphasized that Pakistan cannot enhance its regional competitiveness or significantly boost exports as long as fuel costs remain elevated.

Sheikh advocated for a thorough review of the Petroleum Development Levy (PDL) and other taxes that contribute to domestic fuel prices, noting that global crude oil prices are just one factor behind fuel costs, with taxes and the PDL also adding to the financial strain on businesses, especially small and medium-sized enterprises and large manufacturers.

He proposed that lowering diesel prices would decrease the cost of transporting goods, potentially providing relief to producers and consumers while also reducing expenses for farmers utilizing tractors and tube wells, potentially helping to contain food prices.