By Staff Reporter
ISLAMABAD: The Economic Coordination Committee of the cabinet approved a bailout for the state broadcaster, a plan to recover overdue petroleum levies from a refinery and a mechanism to use gas surcharges to cut electricity tariffs for all consumers
The ECC, chaired by Finance Minister Muhammad Aurangzeb, also cleared the construction of an oil pipeline with Azerbaijan and allocated funds for flood relief in the north.
The decisions reflect Pakistan’s efforts to stabilise state institutions, strengthen energy infrastructure, and address humanitarian needs while meeting commitments under its $7 billion International Monetary Fund program.
A captive levy on gas and regasified LNG for industrial power plants, introduced July 1 under the IMF deal, starts at 5% above the standard tariff, rising to 10% from August 1, 15% from February 1, 2026, and 20% from August 1, 2026.
A parliamentary act requires the revenue to lower electricity bills for all consumers. Some business groups pushed to limit the relief to industrial users, but the Power Division, citing the Captive Levy Act, prevailed.
The ECC approved a monthly fuel cost adjustment to distribute the benefits. The Petroleum Division will transfer funds to the Finance Division within two days of each month’s end. The Power Planning & Monitoring Company will calculate relief based on electricity sales and send recommendations to the National Electric Power Regulatory Authority, which will apply credits to bills with a two-month lag—January collections, for example, will appear in March bills.
The committee endorsed a plan to recover Rs47.5 billion in petroleum levies owed by Cynergico PK Ltd. since 2019, with total liabilities, including surcharges, reaching Rs60 billion. Cynergico has resisted payment despite financial difficulties.
The Special Investment Facilitation Council brokered a deal for Cynergico to pay about Rs1 billion monthly. The Petroleum Division was authorised to sign the agreement and enforce compliance.
The Rs11 billion bailout for Pakistan Television follows the government’s July 1 decision to scrap a PTV fee on electricity bills, which crippled the broadcaster’s ability to pay salaries and pensions. The Finance Ministry will disburse Rs3.8 billion for the first quarter and Rs2.396 billion for each of the next three, shifting the cost to taxpayers.
The ECC approved the tariff framework for the Machike-Thallian-Tarrujabba white oil pipeline, a joint project with Azerbaijan. Pakistan State Oil, the Frontier Works Organisation, and Azerbaijan’s Socar will form a company to manage it.
The Oil & Gas Regulatory Authority will set a dollar-based tariff for the route from Multan to Tarrujabba near Peshawar. Oil marketing companies must commit to minimum annual volumes, with shortfalls covered by inland freight equalisation margins to ensure efficient pipeline use. The Finance Ministry’s call to cut costs was overruled to fast-track the project, seen as vital for Pakistan-Azerbaijan ties.
The committee also allocated Rs3 billion for flood-hit communities in Gilgit-Baltistan, funding tents, food, medicines, and essentials under the Prime Minister’s orders after heavy rains battered the region.
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