The government expects to spend MVR 3.8 billion on fuel subsidies by the end of this year to keep electricity prices low for the public amid rising global oil prices, Minister of Finance and State Enterprises Hassan Zareer said today.
Presenting the proposed MVR 59.7 billion state budget for next year to the People's Majlis, Minister Zareer said the biggest challenge this year has been the rise in state expenditure brought on by changes on the world stage. He noted that although oil prices have increased, particularly due to the ongoing war in the Middle East and the closure of the Strait of Hormuz, the government has kept prices unchanged by providing subsidies so that the public and businesses are not affected.
The Minister highlighted that, against the MVR 2.89 billion budgeted for subsidies this year, MVR 4.3 billion had already been spent on subsidies as of the 15th of this month. However, as forecasts by international financial institutions project lower oil prices next year, spending on fuel subsidies is expected to fall to MVR 3.2 billion next year.
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