Rs. 30 per litre petrol possible in Pakistan, economists say

ISLAMABAD: Prominent Pakistani economist Atif Mian has sparked debate after claiming that the price of petrol in Pakistan could effectively fall below Rs 1.30 per litre, arguing that the current high prices reflect policy failures rather than economic reality.

In a post on X, Atif Mian, who is known for his work on finance and economic crises and is currently a professor at Princeton University, said that people do not actually consume petrol itself but use it for travel, which can be achieved much more cheaply through electric alternatives.

He explained that a fuel-powered motorbike can travel about 60 kilometres per litre, while an electric scooter can cover the same distance using about 2 kW of electricity.

According to him, Pakistan is one of the best countries for solar energy, where electricity can be generated at about 5 cents per kilowatt, which translates into a cost of about 10 cents or about Rs. 10. The equivalent of Rs. 30 per liter in travel costs.

Mian argued that the large difference between Rs. 300 and Rs. 30 reflects poor policy choices, including reliance on expensive imported fuel, dollar-based power projects, and a lack of support for decentralized solar and electric vehicle infrastructure.

He said that the billions of dollars currently spent on fuel imports could instead be used to build EV charging networks, battery swap systems, and smart electricity pricing, creating jobs and boosting local investment.

The economist also highlighted missed opportunities for small businesses, noting that the modular nature of solar power could allow local producers to generate and sell electricity, while battery replacement could develop into a scalable domestic industry.

He added that using cheaper and smarter electricity could help stabilize demand, reduce costs for consumers, and improve air quality, ultimately supporting long-term economic growth. Mian criticized past policies that prioritized fossil fuel plants and protected traditional auto sectors, saying those decisions led to higher electricity prices and slowed the adoption of cleaner technologies.