By Staff Reporter
KARACHI: Interim Prime Minister Anwaarul Haq Kakar said on Thursday his government was working on options to tackle the issue of inflated power bills without violating its agreements with international lenders and it would come up with a policy to provide relief “within 48 hours” amid widespread protests and public anger over the soaring electricity tariffs.
“We have conditionalities and agreements with multi-financial institutions which we have to fulfill at any cost,” he told a news conference in Karachi but added that negotiations with lenders on relief measures were underway.
“We have summoned all our stakeholders, and not only have we mulled over policy options, we have thought about it, and within 48 hours, we will come up with a policy also,” he said.
The caretaker government, which took charge in August after the dissolution of the previous parliament, is facing a host of economic challenges including rising inflation, depreciating rupee, and declining market confidence.
In recent days, people from across the country have taken to the streets to protest against excessive power bills, which they say are unaffordable and unjustified.
The government has failed to come up with any relief measures as it tries to strike a balance between avoiding drawing the International Monetary Fund’s ire and causing more citizens to blow a fuse.
Pakistan is currently under a $3 billion IMF bailout program, which requires the government to implement tough fiscal and monetary reforms, including raising electricity prices to reduce energy sector debt.
A Rs7 increase in basic tariff was approved last month to be levied from September, while last week the National Electric Power Regulatory Authority approved a further hike of Rs4.96 per unit, whose notification has been delayed due to ongoing protests.
Kakar spoke of Pakistan’s agreements with international financial institutions, ruling out categorically that Pakistan would not deviate from the conditionalities it had agreed to with these institutions.
“In a free market, obviously we have conditionalities [imposed on us], we have agreements with multi-financial institutions that we have to fulfill at any cost,” Kakar said. “Neither is anyone thinking of defying them nor will we allow them to. We are very much clear on that.”
Kakar acknowledged the protests against exorbitant power bills but said the issue was being “magnified” by political parties gearing up for polls.
Kakar added that the government was closely looking at the inflated electricity bills and had done its own calculations. “We have held the most number of meetings with respect to this in which we have tried to understand the power sector and talk to them … we have confronted them and asked for solution-based plans,” he stated.
The premier also said that an investigation was underway on reports of free units being used by some sections, asserting that things being said on social media couldn’t be considered “gospel truth”.
The prime minister said Pakistan’s armed forces were not consuming a single unit of free electricity, and they “contribute and pay bills against each and every unit which they consume, and they pay from their budget,” adding that the same was the case with Pakistan’s judiciary. Only Wapda employees were entitled to free units, especially officers from grades 17 to 22.
Media widely reported on Thursday that the government had shared a relief plan for power consumers with the IMF with assurances that the Fund’s agreed targets would not be breached. One proposal is to use an emergency allocation of Rs250 billion in the budget for 2023-24 to provide relief to power consumers. The government has also shared a proposal with the IMF seeking approval for domestic customers to be able to pay electricity bills in installments.
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