Electricity prices raised to secure IMF deal, says Shehbaz

ISLAMABAD: Prime Minister Shehbaz Sharif has stated that electricity prices have been raised under compulsion as it was a condition set by the International Monetary Fund (IMF).

Addressing a ceremony of signing the agreement for cooperation in the petroleum industry between Pakistan and Azerbaijan, the prime minister assured that the increase in prices will not burden the common people. “Subsidies have been provided to 31 per cent of domestic consumers, and 63 per cent of domestic consumers will not be affected,” he claimed.

He further stated that consumers using up to 200 units of electricity will not bear any additional burden, while those using up to 300 units may experience some impact.

He said that the IMF had pointed out that liquidity conditions in the power sector were acute, with a buildup of arrears and frequent power outages.

He said that the IMF had made it a condition for Pakistan to increase its power tariffs in order to reduce the losses and improve the efficiency of the sector.

He said that the government had taken several painful steps to meet the IMF’s fiscal tightening measures, which had fueled inflation in the country. He said that the government was trying to provide relief to the poor and vulnerable segments of society through various social protection programs.

He said that the government was also taking measures to curb power theft, which was a major cause of losses in the sector. He said that he had directed all concerned authorities to take strict action against those involved in power theft and corruption.

He hoped that with the support of friendly countries like Azerbaijan and the cooperation of the people, Pakistan would be able to overcome its economic challenges and achieve prosperity and development.

Sharif mentioned that Pakistan will purchase one LNG cargo from Azerbaijan every month, but Pakistan will decide whether to buy it at the predetermined price or not.

“According to the agreement, if we do not take the cargo, there will be no penalty, and Pakistan will have the option to buy the LNG cargo,” he said.

The prime minister said that the gas deal with Azerbaijan was a historic achievement for Pakistan, as it would help meet the country’s energy needs and reduce its dependence on imported oil.

He thanked Azerbaijan President Ilham Aliyev for his cooperation and friendship.

He also said that Pakistan was committed to enhancing its relations with Azerbaijan in various fields, including trade, investment, defence and tourism.

He invited Azerbaijani businessmen to invest in Pakistan’s energy sector, especially in renewable energy sources.

The prime minister said that Pakistan was facing a huge challenge of reducing its public debt in the power and gas sector, which had accumulated to nearly 4.2 trillion rupees ($14.6 billion).

He said that this was a gaping hole that needed to be dealt with on a war footing.