PM Shehbaz extends nationwide austerity drive amid global oil crisis

ISLAMABAD: Prime Minister Shehbaz Sharif on Monday extended the government’s countrywide austerity drive until June 13 as Pakistan continues to grapple with the economic fallout of the ongoing Middle East conflict and the resulting global oil crisis.

The austerity measures were originally introduced on March 9 following the outbreak of war triggered by US-Israeli attacks on Iran on February 28, which sent international oil prices soaring and intensified economic pressure worldwide.

According to a notification issued by the Cabinet Division, the prime minister approved the extension after reviewing recommendations submitted by the committee overseeing fuel conservation and austerity implementation.

The notification stated that the additional austerity measures would remain in force with immediate effect until June 13, 2026.

Among the measures extended is a 50 per cent reduction in fuel allowances for official vehicles, excluding operational vehicles such as ambulances and public transport buses. The government also decided to keep 60pc of official vehicles grounded as part of fuel-saving efforts.

The ban on foreign visits by ministers and government officials has also been extended, except for visits considered essential in the national interest.

The notification added that all previously announced austerity and fuel conservation measures would continue for the durations specified in earlier directives, while those without a fixed timeline would remain effective until further orders.

Under the broader austerity plan, government offices continue to observe a four-day working week from Monday to Thursday, although the arrangement does not apply to banks, industrial and agricultural sectors, or essential services including hospitals and ambulance services.

The measures also include a 25pc salary cut for parliamentarians and salary reductions ranging from 5pc to 30pc for employees of state-owned enterprises and government-supervised institutions.

Government departments have also been directed to reduce expenditures by 20pc, alongside a ban on the purchase of vehicles, furniture, air conditioners and other non-essential items.

Prime Minister Shehbaz had earlier tasked the Intelligence Bureau with conducting a third-party audit to monitor the implementation of the austerity measures.

In addition, the premier last month extended fuel subsidies for motorcyclists as well as public and goods transport operators by another month to help ease the burden caused by rising fuel prices.

The subsidies were part of targeted relief measures introduced for bikers, farmers and transporters amid economic disruptions linked to the ongoing Iran-US conflict.