Tag: IMF

IMF Rejects Pakistan’s Plan to Cut Industrial Power Tariffs by Rs2.70 Per Unit

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ISLAMABAD – The International Monetary Fund (IMF) has turned down Pakistan’s proposal to reduce industrial electricity prices by Rs2.70 per unit, citing concerns over cross-subsidies and the need for comprehensive power sector reforms. The Ministry of Energy had suggested eliminating cross-subsidies provided by the industrial sector to low-end residential consumers, offering Rs37 billion in relief for February to June and Rs89 billion annually. However, the IMF emphasized that isolated measures would not address systemic issues in the power sector and urged Pakistan to implement targeted subsidy reforms expected to roll…

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Shehbaz Orders Rs 7/unit Electricity Tariff Cut to Boost Economy

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ISLAMABAD: Prime Minister Shehbaz Sharif has directed the Power Division to reduce electricity tariffs by Rs 7 per unit across all consumer categories, including the industrial sector, following consultations with the International Monetary Fund (IMF). An IMF delegation is expected to visit Islamabad next month to finalize discussions. The directive emerged as the Prime Minister expanded the “Tariff Reduction Committee,” now led by Deputy Prime Minister/Foreign Minister Senator Ishaq Dar. The revamped committee includes key figures such as Lt General Muhammad Zafar Iqbal, National Coordinator of the Task Force on…

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IMF Pushes for Levy on Captive Power Plants to Align Costs with Grid Power

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ISLAMABAD: The International Monetary Fund (IMF) has demanded a substantial levy on gas supply to industrial captive power plants (CPPs) as part of Pakistan’s commitments under the $7 billion Extended Fund Facility (EFF). The aim is to eliminate the cost advantage of in-house electricity generation over grid power. A structural benchmark under the EFF requires gas disconnections to CPPs by January 2025 to qualify for the second $1 billion tranche in March 2025. The IMF has rejected Pakistan’s plea to revise this benchmark, insisting instead on imposing an additional levy…

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Power Ministry Confirms Circular Debt Target with IMF on Track

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ISLAMABAD: The Ministry of Power reaffirmed on Sunday that the circular debt targets agreed upon with the International Monetary Fund (IMF) are well within limits, with the December 2024 goal firmly on track. In a statement, the Power Division clarified that its performance aligns with quarterly targets for circular debt management. “The agreed target with the IMF ensures circular debt remains within specific thresholds during each quarter, and the power sector is operating comfortably within these limits,” the ministry said. Addressing recent reports, a Power Division spokesperson emphasized that routine…

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Power Ministry Urgently Seeks Rs400 Billion to Meet IMF Circular Debt Target

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ISLAMABAD: The Ministry of Power has issued an urgent appeal for the release of Rs400 billion in subsidies by December 2024 to meet the International Monetary Fund’s (IMF) conditions under the $7 billion Extended Fund Facility (EFF). Failure to comply risks escalating the circular debt beyond the agreed threshold, jeopardizing financial stability and IMF commitments. So far, only Rs82 billion of the allocated Rs1,229 billion subsidy for FY2024-25 has been disbursed by the Ministry of Finance. To meet IMF requirements, another Rs318 billion must be released immediately. Under the Circular…

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