Pakistan People’s Party (PPP) Senator Mustafa Nawaz Khokhar on Saturday predicted another Rs 30 per liter increase in petroleum product tariffs.

“The IMF may not be happy with the current hike [in petroleum products]. [The government] may also have to give a hard budget,” he wrote on his official Twitter account.

Mustafa, whose party is also part of the coalition government, criticized the government’s handling of the economic crisis. “The theory goes something like this: let’s do what the IMF says, let’s give a tough budget and we’ll relieve the public next year, and then we’ll happily head into the election. Sure, but how much are- we certain that the boys will drop reach this finish line,” the PPP leader wrote, referring to the establishment.

He added that the decision to go to the IMF should be taken by a government with a new mandate.

The statement came days after the government raised petroleum product tariffs by 30 rupees per litre, up to a quarter of their current prices, paving the way for a staff level agreement to be struck with the International Monetary Fund by June 12.

This unprecedented move will help defuse the landmines laid by former Prime Minister Imran Khan’s government on the one hand, and save the country from imminent default on the other.

Finance Minister Miftah Ismail made the decision public at an unscheduled press conference after Prime Minister Shehbaz Sharif gave it the green light at a party meeting.

With the new hike, the new petrol price will be Rs 179.88 per liter – the highest rate ever – and will show a 20% increase on existing prices. Ismail said it was a “difficult decision that will erode the political capital” of the government.

“The government was giving a subsidy of Rs 56 per liter and I only reduced the loss by Rs 30 per litre,” Miftah said at the press conference. The new high-speed diesel price will be Rs 174.86 per litre, an increase of 20.8%.

Read more: PM unveils Rs 28 billion relief package

Miftah said that the government was providing a subsidy of Rs 86 per liter and in the first batch it reduced the amount of subsidy by only Rs 30.

“The government cannot lead the country to default and is ready to pay the political cost to protect the interests of the state,” the finance minister said.

On Friday, Prime Minister Shehbaz Sharif announced a new relief package of 28 billion rupees per month to “protect the poor from the impact of inflation”.

In his first address to the nation a day after his government caved in and fulfilled the IMF condition, the prime minister defended the move as a “necessary step to prevent the country from going bankrupt” and accused the previous government of having “destroyed the country’s economy”. .

Under the relief package, Shehbaz said poor families across the country would receive Rs 2,000 each, while allowances would be paid to deserving families through the Benazir Income Support Scheme (BISP), adding that utility shops had been directed to sell a 10kg sack of flour at Rs400.

Read also: The government gives in to the IMF and drops a petrol bomb

“We raised the prices of petroleum products with a heavy heart. We have sacrificed political interests and preferred the national interest to get the economy out of the current crisis,” he said. “We will make all the decisions and do our utmost to advance the path of national development.”

The next big step the government must now take is to raise electricity prices by Rs 5 per unit from June 1, the sources said.

The total price increase will be around 12 rupees per unit, which will include the removal of the electricity subsidy of 5 rupees per unit and quarterly and annual tariff adjustments.

However, the decision will fuel inflation which was already at 13.4% in April, the highest in two years. The government had a choice of taking the hit by raising prices or letting the rupee weaken in the absence of an IMF deal, with meager foreign exchange reserves that could have caused hyperinflation.

But the government only acted after the IMF refused to sign a staff level agreement until Pakistan took corrective action, including the cancellation of fuel subsidies and an agreement on the budget of next year.

The government’s decision to raise prices at the expense of political capital suggests it may have won a green light from the establishment to stay in power longer than previously thought.

The government had refused to make tough decisions and then call a snap election just to pave the way for PTI victory.

The journey towards restoring macroeconomic stability may also help stem losses in rupees which fell to new lows of Rs203 per dollar on Thursday. Foreign exchange reserves also fell to $10 billion, according to the central bank.