DHAKA: Egypt has drastically raised fuel prices overnight to tackle a bloated subsidy system, in a potentially unpopular move that might blow back on newly elected president Abdel Fattah al-Sisi.

With the economy battered by three years of unrest, successive governments have said the subsidies that allowed Egyptians to buy gasoline at some of the world’s cheapest prices must be lifted.

Ex-army chief Sisi, elected by a landslide in May, has advocated austerity to narrow the budget deficit, and a severe law and order platform to rein in Islamist supporters of ousted president Mohamed Mursi.

Mursi himself had balked at implementing the cuts, to avoid stoking unrest, but the military ousted the divisive leader anyway after millions took to the streets demanding his resignation, reports The Straits Times.

BDST: 1949 HRS, JULY 05, 2014