ISLAMABAD: Prime Minister Shehbaz Sharif on Thursday unveiled a major reduction in electricity tariffs, offering relief to both domestic and industrial consumers. In a special address to a gathering of parliamentarians, cabinet members, and senior government officials, the Prime Minister announced a reduction of Rs7.41 per unit for domestic consumers and Rs7.59 per unit for industrial consumers.
Shehbaz Sharif began his speech by providing a historical context of electricity prices, noting that in June 2024, the cost for domestic consumers stood at Rs48.70 per unit. However, following this reduction, the price has dropped to Rs45.05 per unit. He further revealed that the new rate would be reduced by an additional Rs7.41, bringing the tariff for domestic consumers down to Rs34.37 per unit. This marks a significant relief for households grappling with rising energy costs.
For industrial consumers, the government has also rolled out a reduction in tariffs. The previous rate of Rs58.50 per unit for industries has now been reduced to Rs48.19 per unit, followed by an additional reduction of Rs7.59, bringing the rate down to Rs40.60 per unit. This cut is expected to benefit the industrial sector, which has been struggling with high energy prices that have hindered economic productivity.
PM Shehbaz stated that the electricity tariff reductions were a direct result of the government’s efforts to stabilize the country’s economy and ensure long-term growth. He explained that economic stability had played a crucial role in facilitating this tariff reduction. "The government worked tirelessly to stabilize the economy and avoid the looming danger of bankruptcy," he said, pointing out that macroeconomic indicators have significantly improved over the past year.
The Prime Minister acknowledged that the high cost of electricity had severely impacted both the public and economic activities in the country. “I am aware that expensive electricity has impacted the public,” he remarked. However, he added that the reduction in electricity prices is expected to ease some of the burdens faced by citizens and businesses alike.
Addressing the ongoing economic reforms, Shehbaz Sharif noted that inflation had dropped to a single-digit figure and that the prices of petroleum products had decreased by Rs38 per liter over the course of the year. He also highlighted that petroleum prices in Pakistan were now among the lowest in the region. Furthermore, the policy rate had been reduced to 12%, signaling positive signs of macroeconomic stability. He emphasized that privatization and rightsizing remained central to the government’s economic reform strategy.
The Prime Minister also revealed the challenges the government faced in securing the necessary approvals from the International Monetary Fund (IMF) to reduce electricity tariffs. “It was very challenging to convince the IMF to allow a cut in power tariffs. The IMF was initially resistant to our proposal,” he said, adding that efforts were made to create obstacles in the IMF programme. However, through persistent negotiations and hard work, the government was able to secure the approval, averting the threat of bankruptcy.
Minister for Energy Awais Leghari also spoke at the event, emphasizing that the energy sector reforms were implemented with a focus on transparency and merit. He highlighted the efforts to address the difficulties faced by both the public and industrial consumers in the energy sector. The Prime Minister had also established a task force with competent officers from various organizations to ensure the success of these reforms.
The gathering was attended by key figures in the government, including Deputy Prime Minister Ishaq Dar, Federal Ministers Awais Leghari, Muhammad Aurangzeb, Rana Sanaullah, Khawaja Asif, Azam Nazir Tarar, Ahsan Iqbal, and other senior officials.
Earlier, the IMF had approved the government’s request to reduce the basic electricity tariff by Re1, further indicating positive steps in managing the country's financial challenges.
This move by the government marks a significant step toward providing financial relief to both domestic consumers and industrialists, aligning with broader goals of promoting economic recovery and growth.
