IMF approves govt's proposal to reduce electricity prices
Business
During crucial discussions, Ministry of Energy officials held talks with IMF on tariff rebasing
ISLAMABAD (Mudassar Ali Rana) - The International Monetary Fund (IMF) has accepted the Pakistan government’s proposal to lower electricity prices.
Negotiations between Pakistan’s economic team and the IMF delegation have entered the final phase as Pakistan sought to secure the second tranche of over $1 billion under the $7 billion Extended Fund Facility (EFF) programme.
During crucial discussions, the Ministry of Energy officials held talks with the IMF on tariff rebasing.
Sources indicate that the IMF has given a green signal for reducing electricity rates, allowing NEPRA and the Ministry of Energy to make the final decision.
A proposal to cut base tariffs by up to Rs2 per unit from April or May was shared with the IMF.
Additionally, authorities presented the IMF with a privatisation plan for power distribution companies (DISCOs). The IMF expressed serious concerns over delays in privatising two DISCOs by January and highlighted inefficiencies in the power sector.
The IMF also opposed amendments to the NEPRA Act proposed by the Ministry of Energy.
Further negotiations on the circular debt in the power sector, tax policies, and sovereign wealth fund discussions are scheduled for today.
Another IMF delegation may visit Pakistan after Eid for governance-related talks.
