Business Recorder
ISLAMABAD: Prime Minister Shehbaz Sharif on Monday extended the nationwide austerity drive until 13 June, as the country continued to grapple with rising fuel prices linked to the Middle East conflict. The measures, initially introduced on March 09, will remain in force until June 13, according to a notification issued by the Cabinet Division. The extension comes in response to ongoing disruptions in global oil markets following attacks on Iran by US and Israeli forces on February 28, 2026, which have caused energy prices to surge worldwide. READ MORE: Upper House of Parliament: Gilani, Aurangzeb discuss austerity measures In the notification, the Cabinet Division stated that the prime minister, “on consideration of the recommendations of the committee for monitoring and implementation of fuel conservation and additional austerity measures, has been pleased to extend the applicability” of the measures with immediate effect. Among the key restrictions, government officials will see a 50 per cent reduction in fuel allowances for official vehicles, though ambulances, public buses, and other operational vehicles are exempt. Additionally, the government will ground 60 per cent of its fleet and maintain a ban on foreign travel for ministers and civil servants, except in cases deemed essential for national interest. “These additional austerity and fuel conservation measures shall continue to remain in force over the periods specified,” the notification added. “Measures without a specified end date shall remain applicable until further notice.” The austerity programme, which has already reshaped government operations, shortened the official workweek for most state offices to four days, running from Monday to Thursday. However, banks, essential services, and sectors such as agriculture and industry have not been affected by the change in schedule. Under the measures, the salaries of parliamentarians were to be reduced by 25 per cent, while employees of state-owned enterprises (SOEs) and government-supervised institutions faced pay cuts ranging from 5 to 30 per cent. Government departmental spending was cut by 20 per cent, accompanied by a ban on the purchase of vehicles, furniture, air conditioners, and other non-essential items. Prime Minister Shehbaz had instructed the Intelligence Bureau (IB) to conduct a third-party audit to ensure proper implementation of the austerity measures. On 30 April, he also approved a one-month extension of fuel subsidies for motorcyclists, as well as for public and goods transport. These subsidies were part of targeted relief measures aimed at supporting bikers, farmers, and transport operators, helping to cushion the impact of global oil price surges amid the US-Israel conflict with Iran. Copyright Business Recorder, 2026
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