2 weeks Ago
As Pakistan’s economy struggles with the recent imposition of US tariffs on its exports, Prime Minister Shahbaz Sharif has announced a much-needed relief measure: a nationwide reduction in power tariffs by Rs. 7.41 per unit.
This move comes as a significant reprieve for consumers burdened by exorbitant electricity bills, especially ahead of the summer months when power usage surges due to increased reliance on air conditioning, fans, and other appliances. In these difficult economic times, such relief is essential for households already struggling to manage rising costs. The reduction is also a much-needed boost for Pakistan’s industry, where electricity prices have been cut by Rs.
7.69 per unit. Lower energy costs will improve competitiveness by reducing manufacturing expenses, providing a crucial advantage for industrial growth.
Given that Pakistan remains under an IMF programme, negotiating such concessions was no easy feat, as the Fund typically urges the government to maximise revenue collection. The government deserves credit for its negotiation strategy, particularly following the renegotiation of agreements with independent power producers, which has helped stabilise electricity generation. Additionally, with the rapid adoption of solar power and the introduction of electric vehicles and charging stations, Pakistan’s energy landscape appears to be moving in a positive direction.
However, challenges remain. Electricity theft, non-payment—particularly by commercial enterprises—and an ageing infrastructure continue to cause significant losses. To build on the progress made, the government must prioritise the restructuring of local power distribution companies and reform collection methods.
Only with sustained efforts in these areas can Pakistan achieve a more efficient and reliable power sector in the long run..
