Cabinet approves power tariff hike ahead of virtual IMF talks

Author: Web Desk

The federal cabinet has approved an increase in electricity tariffs in order to free much-needed cash from the International Monetary Fund (IMF), which may result in a Rs7.91 per unit rise over four quarterly adjustments.

The Sharif-led administration moves quickly to meet the conditions imposed by the US-based lender. A revamped circular debt management plan through circulation was also approved by the cabinet.

The former power subsidy for the export sector and farmers will be phased out under the plan, which will save roughly Rs250 billion. The average increase in power rate will be Rs3.21 per unit in February, 69 paisas in March, Rs1.64 in June, and approximately Rs2 per unit in the final phase.

Pakistan mulled new stringent measures as the cash-strapped nation failed to woo the IMF team over fiscal measures.

The federal government has amplified pushing extreme conditions tabled by IMF to revive the $7 billion Extended Fund Facility (EFF) stalled for months as the country’s foreign exchange reserves plunged to less than $3 billion.

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