The caretaker government of Pakistan is engaging with the International Monetary Fund (IMF) to discuss relief measures for electricity consumers. Interim Information Minister Murtaza Solangi made this announcement after a federal cabinet meeting, where the Ministry of Energy’s recommendations for reducing high electricity bills were discussed.
The decision to engage with the IMF was taken due to public demonstrations across the country, with many people protesting against the high electricity bills following a significant rise in the national average tariff.
The caretaker cabinet has finalized a list of proposals to provide relief to the inflation-hit population, which will be presented in the meeting with the IMF. Interim Finance Minister Shamshad Akhtar is currently in talks with the IMF, and an announcement is expected in the near future.
The relief measures will not affect the primary surplus and circular debt, which are the two pillars of the country’s economic stability. The IMF had previously approved a $3 billion nine-month standby arrangement for Pakistan to support the economic stabilisation programme.
While the cabinet meeting was ongoing, the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) rejected the recent increase in electricity prices. FPCCI President Irfan Iqbal Sheikh highlighted that the burden of price hikes had become unbearable for the people, and prices should not exceed the paying capacity of the population.
The rising electricity costs have led to declining consumption and additional capacity charges being shifted to consumers, prompting the government to seek staggered imposition of charges to minimize the price shock. The situation was raised during a public hearing organized by the National Electric Power Regulatory Authority (Nepra).
The Power Division proposed a revised plan to charge consumers at a lower rate over a longer period, reducing the cost increase and minimizing the impact on consumers.