ISLAMABAD: Pakistan’s main electric power regulator is likely to increase the power tariff by Rs6.1 per unit in March electricity bills, local media reported on Sunday, days after a historic hike in the prices of petroleum products.
The possible hike in power tariff will add to the burden of the masses, who are already reeling from inflationary pressures in Pakistan due to rising food and fuel prices worldwide.
The increase in power tariff will come on the back of fuel price adjustment for the month of January, as the country paid a high price for producing power from furnace oil and diesel, the Dawn newspaper reported.
“In an application, the Central Power Purchasing Agency (CPPA) has informed the power sector regulator that the net cost of electricity production was Rs12.61 per unit during the month [of January],” the report read.
“The reference fuel charges set by the National Electric Power Regulatory Authority (NEPRA) stand at Rs6.51 per unit, or kilowatt hour. The CPPA has sought an increase of Rs6.10 per unit on account of Fuel Charges Adjustment (FCA) for January.”
NEPRA has summoned a public hearing on the matter on February 28 and invited all concerned entities and citizens to present their points of view on the CPPA demand, according to the report.
The regulator generally accepts the CPPA’s demands regarding fuel price adjustment.
Pakistan earlier this week increased the prices of petrol, high-speed diesel, kerosene and light diesel oil, with petrol going up by a record Rs12.03 per liter.
After the increase of Rs12.03, petrol is now available for Rs159.86 and high-speed diesel at Rs154.15, a rise of Rs9.53.
Kerosene is being sold for Rs126.56 per liter after an increase of Rs10.08, while light diesel oil is available for Rs123.97 after a Rs9.43 hike.
The government has faced criticism for increasing fuel prices during the last few months, but top officials argue the country still offers petroleum products at the cheapest rates in the region.
Pakistan fixes prices of petroleum products on a fortnightly basis to pass on the impact of fluctuating international prices to consumers.
In January, NEPRA jacked up the power tariff by Rs4.30 per unit, allowing distribution companies (DISCOs) to charge consumers an additional fuel cost for their November 2021 bills.
After historic fuel price hike, Pakistan regulator likely to increase power tariff by Rs6.1
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After historic fuel price hike, Pakistan regulator likely to increase power tariff by Rs6.1
- Hike in power tariff will come on the back of fuel price adjustment for the month of January
- The country’s power regulator usually accepts demands regarding the fuel price adjustment
IMF warns against policy slippage amid weak recovery as it clears $1.2 billion for Pakistan
- Pakistan rebuilt reserves, cut its deficit and slowed inflation sharply over the past one year
- Fund says climate shocks, energy debt, stalled reforms threaten stability despite recent gains
ISLAMABAD: Pakistan’s economic recovery remains fragile despite a year of painful stabilization measures that helped pull the country back from the brink of default, the International Monetary Fund (IMF) warned on Thursday, after it approved a fresh $1.2 billion disbursement under its ongoing loan program.
The approval covers the second review of Pakistan’s Extended Fund Facility (EFF) and the first review of its climate-focused Resilience and Sustainability Facility (RSF), bringing total disbursements since last year to about $3.3 billion.
Pakistan entered the IMF program in September 2024 after years of weak revenues, soaring fiscal deficits, import controls, currency depletion and repeated climate shocks left the economy close to external default. A smaller stopgap arrangement earlier that year helped avert immediate default, but the current 37-month program was designed to restore macroeconomic stability through strict monetary tightening, currency adjustments, subsidy rationalization and aggressive revenue measures.
The IMF’s new review shows that Pakistan has delivered significant gains since then. Growth recovered to 3 percent last year after shrinking the year before. Inflation fell from over 23 percent to low single digits before rising again after this year’s floods. The current account posted its first surplus in 14 years, helped by stronger remittances and a sharp reduction in imports. And the government delivered a primary budget surplus of 1.3 percent of GDP, a key program requirement. Foreign exchange reserves, which had dropped dangerously low in 2023, rose from US$9.4 billion to US$14.5 billion by June.
“Pakistan’s reform implementation under the EFF arrangement has helped preserve macroeconomic stability in the face of several recent shocks,” IMF Deputy Managing Director Nigel Clarke said in a statement after the Board meeting.
But he warned that Islamabad must “maintain prudent policies” and accelerate reforms needed for private-sector-led and sustainable growth.
The Fund noted that the 2025 monsoon floods, affecting nearly seven million people, damaging housing, livestock and key crops, and displacing more than four million, have set back the recovery. The IMF now expects GDP growth in FY26 to be slightly lower and forecasts inflation to rise to 8–10 percent in the coming months as food prices adjust.
The review warns Pakistan against relaxing monetary or fiscal discipline prematurely. It urges the State Bank to keep policy “appropriately tight,” allow exchange-rate flexibility and improve communication. Islamabad must also continue raising revenues, broadening the tax base and protecting social spending, the Fund said.
Despite the progress, Pakistan’s structural weaknesses remain severe.
Power-sector circular debt stands at about $5.7 billion, and gas-sector arrears have climbed to $11.3 billion despite tariff adjustments. Reform of state-owned enterprises has slowed, including delays in privatizing loss-making electricity distributors and Pakistan International Airlines. Key governance and anti-corruption reforms have also been pushed back.
The IMF welcomed Pakistan’s expansion of its flagship Benazir Income Support Program, which raises cash transfers for low-income families and expands coverage, saying social protection is essential as climate shocks intensify. But it warned that high public debt, about 72 percent of GDP, thin external buffers and climate exposure leave the country vulnerable if reform momentum weakens.
The Fund said Pakistan’s challenge now is to convert short-term stabilization into sustained recovery after years of economic volatility, with its ability to maintain discipline, rather than the size of external financing alone, determining the durability of its gains.
