The Pakistani government will cease purchasing electricity from producers in a fundamental reshaping of the nation’s power sector, a historic policy shift that will allow citizens and industries to buy and sell electricity directly. The landmark announcement was made on Monday as part of a comprehensive package of economic reforms aimed at achieving sustainable stability.
Energy Minister Owais Leghari declared the move would ensure better prices and efficiency, marking a significant departure from the existing system. He detailed that despite inheriting a costly energy infrastructure, the administration has successfully reduced electricity prices by Rs10.5 per unit over the last 18 months. “We have cut industrial tariffs by Rs16 per unit and electric vehicle charging rates from Rs71 to Rs39 per unit,” Leghari added.
The minister also revealed that auctioning off inefficient generation plants saved the national exchequer Rs48 billion. A comprehensive strategy is now underway to eliminate the Rs1.2 trillion circular debt within six years without placing additional financial strain on consumers.
Speaking at a joint press conference, Federal Minister for Finance, Senator Muhammad Aurangzeb, presented these initiatives as crucial components of the government’s agenda for durable and inclusive economic stability. He asserted that a recent agreement with the International Monetary Fund (IMF) serves as an endorsement of Pakistan’s macroeconomic stabilization efforts. “Pakistan’s macroeconomic indicators are stabilizing, and global rating agencies have recognized our economic progress,” Aurangzeb stated.
On the taxation front, Federal Board of Revenue (FBR) Chairman Rashid Mahmood Langrial reported an 18 increase in income tax return filings, with the number of taxpayers swelling to 5.9 million. He assured that “there is no need to impose new taxes,” attributing improved collection to effective enforcement. The government aims to elevate the tax-to-GDP ratio to 18 in the coming years, a goal the Prime Minister personally oversees in weekly meetings.
Langrial acknowledged enforcement difficulties, particularly in hazardous sectors like narcotics where officials face threats, but noted that support from Rangers and other institutions is now bolstering tax compliance efforts.
The government is also aggressively pursuing its privatization agenda with a focus on transparency. Muhammad Ali, the Prime Minister’s Advisor on Privatization, confirmed that four consortiums-Fauji Foundation, Airblue, Lucky Cement, and Arif Habib Group-are bidding for Pakistan International Airlines (PIA). He also mentioned the recent Rs5 billion sale of the First Women Bank and plans to privatize distribution companies, starting with IESCO, LESCO, and FESCO.
In a push for governance reforms, Prime Minister’s Coordinator for Right-Sizing, Salman Ahmad, announced that 20 ministries have been restructured and 54,000 vacant government positions have been abolished. He added that loss-making state entities like PASCO are slated for dissolution.
Complementing these reforms is a major digital transformation initiative. IT Minister Shaza Fatima revealed plans for a National Digital Exchange to create a unified digital framework for federal institutions. Citing the Digital Nation Pakistan Act, she outlined the objective of fostering a cashless economy and achieving a $10 billion digital impact within four years. Fatima projected that greater adoption of digital payments could boost Pakistan’s GDP by an additional Rs40 billion.