By Staff Reporter
ISLAMABAD: Interim government is in talks with the International Monetary Fund (IMF) to secure its consent for a package of relief measures for electricity consumers, who have been hit hard by a sharp hike in power tariffs.
Interim Information Minister Murtaza Solangi said Tuesday that the cabinet, led by Prime Minister Anwaarul Haq Kakar, had approved a set of short-, medium- and long-term proposals to ease the burden on the public, but they needed the IMF’s endorsement before announcing them.
“As we speak, our [interim] Finance Minister Shamshad Akhtar is talking to them. So I hope we will soon be in a position to make the announcement,” Solangi said in an interview with a private TV channel.
He said he expected the IMF to agree to the relief measures, which he claimed would not affect the “two pillars” of primary surplus and circular debt — key indicators of fiscal discipline and energy sector reform that the IMF monitors under its $3 billion bailout program for Pakistan.
The IMF had approved a nine-month standby arrangement (SBA) for Pakistan in July to support the country’s economic stabilization program amid the coronavirus pandemic and political uncertainty ahead of general elections scheduled for October.
One of the conditions of the SBA was an increase in uniform national tariffs to ensure further progress on structural reforms, particularly with regard to energy sector viability and state-owned-enterprise governance, and cost recovery.
Following the IMF’s demand, the outgoing government of Shehbaz Sharif had raised the base power tariff by Rs7 per unit in mid-July, triggering widespread public outrage and protests across the country.
The protesters complained that their electricity bills had doubled or tripled after the tariff hike, which came at a time when they were already struggling with inflation, unemployment and poverty.
The interim government, which took charge in August to oversee a smooth transition to the next elected government, had promised to address the issue and provide some relief to the masses.
Solangi said the energy ministry had finalized a list of proposals, which included converting some bills into instalments and adjusting some amounts in power bills for winter months when power consumption is low.
However, he did not give any details about the amount or duration of the relief, saying it would depend on the outcome of the talks with the IMF.
The minister said he hoped that an announcement would be made within a few hours, as there were some time differences and complications involved in negotiating with the IMF.
He also appealed to the public to remain calm and patient, and assured them that the caretaker government was doing its best to resolve their grievances. “If we have taken the responsibility to run the country even for a limited time, we have to give some relief to the masses.”
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