ISLAMABAD: Accelerating efforts to meet conditions set by International Monetary Fund (IMF), Cabinet approved plan to increase electricity prices and end subsidies. Cabinet approved revised circular debt management plan through circulation in this regard.

 According to plan, which will be presented to IMF, government will jack up electricity prices by Rs 7.91 per unit in four quarterly adjustments-Feb-March, March-May, June-Aug and September-November 2023. Under circular debt management plan, government will charge Rs 3.21 per unit from now onwards, Re 0.69 from March-May and increasing again to Rs 1.64 per unit from June onwards to August. From Sep-Nov will hike power tariff by Rs 1.98 per unit. Consumer base tariff will be increased from Rs 15.28 per unit to Rs 23.39 per unit till June 2023.

Government approved to end electricity subsidy of Rs 65 billion given to exporters with effect from March 2023. Subsidy was Rs 12.13 per unit.

 Government will be able to get Rs 51 billion from withdrawal of subsidy on electricity for exporters while Rs 14 billion will be collected by ending subsidy on electricity under Kisan package from March 2023. About 250 billion rupees will also be recovered from electricity consumers by June 2023. Under plan, surcharge of Rs 3.39 per unit will be levied, sources said. Rs 73 billion will be obtained from increase in quarterly adjustments till June.

Published in The Daily National Courier, February, 13 2023

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