How will Pakistan's new power pricing affect middle-class households?

Middle-class households in Pakistan may face power cost increases of up to 50% due to the shift of subsidy cuts from industries.

What is the projected impact of Pakistan's new power proposals on inflation?

Analysts predict that Pakistan's new power price proposals could lead to a 1.1 percentage point increase in inflation over a 12-month period.

What changes are being made to solar power pricing in Pakistan?

The regulator has cut the rate paid to rooftop solar users exporting power to the grid, and a government review is underway to prevent cost transfers to grid consumers.

Home / Business and Economy / Pakistan's Power Plan: Middle Class Bears Brunt

Pakistan's Power Plan: Middle Class Bears Brunt

12 Feb

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Summary

New power proposals shift subsidy cuts from industries to households.
Inflation could rise by 1.1 percentage points over 12 months.
Middle-class households may face up to 50% increase in power costs.

Pakistan's Power Plan: Middle Class Bears Brunt

Pakistan's new energy pricing framework is poised to shift the burden of International Monetary Fund-mandated subsidy cuts from industries to middle-class households. This strategic adjustment is anticipated to contribute to a 1.1 percentage point rise in inflation over a 12-month period, according to financial analysts. The plan aims to remove approximately 102 billion Pakistani rupees in subsidies, with projections indicating a significant increase in power costs for average consumers.

Under the proposed changes, industrial power prices are expected to decrease by 13% to 15%, while middle-class households could see their electricity bills increase by as much as 50%. This move comes amidst Pakistan's ongoing efforts to manage its economy, including previous battles with high inflation rates nearing 40% in 2023. While current inflation has moderated, these power price adjustments introduce new inflationary pressures.