Thread by @rogueonomist

Pakistan consumes about 58.8 liters per day of petrol and diesel -- even a PKR 10/ltr subsidy leads to PKR 18bn of lost revenue monthly (c. PKR 215bn p.a.)

36mn vehicles in PK, of which 30mn are motorcycles. There is no reason for a blanket subsidy


1/ rogueonomistt.substack.com/p/the-pkr-120-…

Oil and product prices have more than doubled in last three weeks, if the same is not passed on to the pump it will lead to the same disaster that happened in 21-22. Reluctance to pass on prices will result in higher deficits, and higher inflation across the board
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There are 30m bikes in PK, almost one in three males in labour force in PK have a bike. A direct subsidy/transfer to the more vulnerable households is a more optimal strategy than a brute force blanket subsidy

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A directed subsidy plan for motorcycle costs a fraction of blanket subsidy, shelters the vulnerable households, and significantly reduces deficit.

The same can be done through RAAST and @NadraPak tech stacks. RAAST provides the payments layer, NADRA provides identity layer
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Each motorcycle can be linked to a CNIC (registered) - if not registered, then maybe register to be eligible. The CNIC is linked to a bank account enabled by RAAST. Effectively, it is possible to create a fuel account, against which relevant subsidy can be disbursed
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Sufficient QR and other methodologies exist to increase uptake of the same. This not just solves the directed subsidy problem, but also becomes a massive boost for cashless trxns. Yes, there will he edge cases, but worthy of solving them to save quarter of a trillion rupees
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The tech stacks exists. This isnt the first oil crisis, and won't be the last. The tech stacks didnt exist in 21-22. It is now mature enough to be rolled be out.

Throwing money at the problem doesn't work, when one doesn't have money. It only makes things worse
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