Govt moves to roll out app-based fuel quota scheme amid rising fiscal strain

The government is preparing to launch a quota-based fuel distribution system for low-income motorists through a mobile application platform, with a final policy decision awaited on whether the scheme will remain limited to motorcycles and rickshaws or be expanded to small cars.

Officials said the digital system has been technically finalised following joint testing by the Oil and Gas Regulatory Authority, the Ministry of Finance, the Ministry of Petroleum, and the Ministry of Information Technology and Telecommunication, clearing the project for cabinet-level approval.

The proposed mechanism is designed to deliver targeted fuel subsidies to the low-income segment while using controlled allocations to curb consumption amid mounting supply and fiscal pressures.

Under the system, vehicle-specific quotas will be linked to a user’s Computerised National Identity Card and registration number. Consumers will generate digital vouchers through a mobile application, which fuel station operators will validate before dispensing fuel based on the remaining quota balance.

Authorities said the platform will automatically restrict supply to approved limits. For example, a user requesting 20 litres of fuel with an authorised quota of 15 litres will only be supplied the eligible quantity.

Petrol stations will be required to maintain at least two dedicated mobile devices to run the system. The Ministry of Information Technology and Telecommunication is coordinating with handset manufacturers to provide specialised devices at an estimated Rs36,000 per unit, with expected retail pricing around Rs72,000. Retailers have been instructed to deposit funds into a designated government account to facilitate timely delivery.

Operational guidelines will also require filling stations to assign specific dispensers or nozzles for subsidised fuel transactions involving two- and three-wheelers. In addition, oil marketing companies will designate focal persons for each retail outlet to support implementation and provide contact details to regulators for continuous monitoring and complaint handling.

The urgency behind the scheme reflects growing financial pressure on the government from maintaining stable fuel prices despite escalating global costs. Officials estimate that keeping petrol and diesel rates unchanged for two consecutive weeks has imposed a fiscal burden of about Rs70 billion, financed through cuts in development spending and emergency allocations.

Energy supply risks have intensified due to shipping disruptions in the Strait of Hormuz, a critical artery for global oil trade.

After increasing petrol and diesel prices by Rs55 per litre on March 6, authorities have held rates steady in two subsequent weekly revisions, even as kerosene and jet fuel prices have risen by approximately 128 per cent and 150 per cent, respectively, since the escalation of hostilities.

Separately, the finance and foreign affairs ministries are engaged in parallel coordination with Iran and Saudi Arabia to manage supply conditions, while the quota-based system is being fast-tracked to ensure uniform implementation across fuel stations nationwide.

Earlier, Petroleum Division Secretary Hamed Yaqoob Shaikh told a Senate committee that the government was developing a subsidised fuel relief package for motorcycle and rickshaw owners to cushion the impact of recent fuel price increases.