Pakistan fails to convince IMF on relief in electricity bills: sources
- By Shoaib Nizami -
- Sep 04, 2023
Pakistan has failed to convince the International Monetary Fund (IMF) for relief in electricity bills as it could affect the recovery of up to Rs6.5 billion as per the government’s plan, citing sources, ARY News reported on Monday.
Sources closer to the finance ministry told ARY News that Pakistan and IMF did not reach a consensus over the relief on electricity bills. It was learnt that the caretaker government told the Fund in its plan that the relief would affect the recoveries by up to Rs6.5 billion.
It emerged that the Fund rejected the plan as it could have affected the recoveries by more than Rs15 billion. The IMF also sought a plan from Pakistan to fill the financial gap of Rs15 billion.
Related: Caretaker finance minister rules out ‘more subsidies’ in IMF agreements
Sources added that the caretaker set-up delayed the announcement for relief on the electricity bill as it is going to share the revised plan with the IMF.
After sharing the new plan, the finance ministry and the IMF officials will hold negotiations again. The Pakistani caretaker government assured the IMF that the required relief would not violate the budgetary limitations.
The finance ministry had requested the Fund to receive the electricity bills in instalments for four months. The ministry will hold negotiations with the Fund again for receiving the electricity bills in instalments.
Related: IMF’s another condition fulfilled by Pakistan
On August 31, Caretaker PM Anwaarul Haq Kakar said that the government has decided to announce relief on electricity in the next 48 hours.
He said this issue has become longstanding as a result of unfavourable contracts with IPPs during the ’90s, inefficient bill recovery process and bad transmission lines.
The prime minister regretted that for many decades we remained unable to plan an increase in hydel production and the increased dependency on imported fuel for power generation multiplied the electricity cost.
He said the best possible professionals have been included in the cabinet to deal with prevailing crucial challenges including economy and defence.
PM Kakar categorically refuted the impression being circulated on social media regarding the exploitation of the masses through electricity bills and other taxes.
The inflated power bills triggered country-wide protests from Karachi to Khyber and protests in some parts of the country are turning violent.
The protesting masses have been demanding that the government should end the provision of free electricity to the notables and provide them relief as the bills they have been receiving are more than their salaries.