ISLAMABAD: Prime Minister Shehbaz Sharif on Friday called for shutting down inefficient and outdated power plants that produced less power with higher fuel consumption, Pakistani state media reported.
Pakistan produces expensive electricity due to a combination of factors, including outdated infrastructure and inadequate power plants, reliance on imported fossil fuels, inefficient energy mix, substantial transmission and distribution losses, and chronic issues like circular debt and regulatory inefficiencies.
Additionally, fluctuations in foreign exchange rates and complex tariff structures contribute to higher electricity prices, while underutilization of domestic resources such as hydropower and coal add to the problem. High power cost is one of the key factors that leads to inflation in the South Asian country.
On Friday, Sharif presided over a meeting in Islamabad to evaluate and discuss future plans for power generation in the country and said only low-cost power projects should be prioritized in the future, the Radio Pakistan broadcaster reported.
“The closure of such [outdated] power plants will not only save valuable foreign exchange spent on fuel imports, but also reduce the cost of electricity for consumers,” he was quoted as saying.
The prime minister called for expediting implementation of ongoing reforms and instructed officials to modernize the power transmission system as per international standards, according to the report.
In October, Sharif said his government was terminating purchase agreements with five independent power producers (IPPs) to rein in electricity tariffs as households and businesses buckled under soaring energy costs.
The need to revisit power deals was part of reforms for a critical staff-level pact in July with the International Monetary Fund (IMF) for a $7-billion bailout. The program was approved in September.
Pakistan has also begun talks to reprofile power sector debt owed to China and structural reforms, but progress has been slow. It has also promised to stop power sector subsidies.
Pakistan PM calls for shutting down outdated power plants with higher fuel consumption
https://arab.news/zvhab
Pakistan PM calls for shutting down outdated power plants with higher fuel consumption
- Pakistan produces expensive electricity due to outdated infrastructure, reliance on imported fuel, and substantial transmission losses
- PM Shehbaz Sharif calls for expediting implementation of ongoing reforms and modernization of the country’s power transmission system
Pakistan says economy stabilizing as it looks to 2026 growth
- Inflation averages 5 percent, remittances hit $16.1 billion as government cites signs of recovery
- IT exports, industry and development spending highlighted as focus shifts to next year’s targets
ISLAMABAD: Pakistan’s economy has shown signs of stabilization in the first half of the current fiscal year, Planning Minister Ahsan Iqbal said on Thursday, as the government looks ahead to sustaining growth momentum into 2026 after several years of economic volatility.
Briefing the media on economic performance through November, Iqbal said key indicators including inflation, industrial output, exports, remittances and fiscal revenues had improved, creating what he described as a more stable base for forward planning.
Pakistan has spent much of the past two years navigating high inflation, external financing pressures and fiscal tightening under an IMF-backed reform program. While growth remains modest, officials say recent data suggests the economy has moved out of crisis mode and into a consolidation phase.
“During July to November of fiscal year 2025–26, stability has returned to Pakistan’s economy,” Iqbal said, adding that average inflation during the period stood at around 5 percent, compared with 7.9% last year, easing pressure on households and businesses.
Large-scale manufacturing posted growth of 4.1 percent, which Iqbal described as “clear evidence of recovery in industrial activity.”
The planning minister said government revenues also improved, with Federal Board of Revenue collections reaching Rs4,733 billion ($16.9 billion) during July–November, reflecting a 10.2% increase.
External inflows remained resilient, with workers’ remittances rising 9.3% to $16.1 billion, while IT services exports increased 19% to $1.8 billion over the same period, he said.
On the public investment side, Iqbal said Rs196 billion ($700 million) were released under the development budget during the quarter, of which Rs92 billion ($329 million) had already been spent. He added that cost rationalization in development projects between July and October saved Rs3.3 billion ($11.8 million) billion in public funds.
In November, the planning minister said, the Central Development Working Party approved 10 development projects, while six major schemes were referred to the Executive Committee of the National Economic Council.
Iqbal said the approved projects were expected to create 994 immediate jobs, with nearly 24,859 direct and 40,873 indirect employment opportunities projected overall.
Looking ahead, he said all future development schemes would be required to comply with green building codes to ensure environmental protection and sustainable growth.
He also highlighted skills and innovation initiatives, saying that under the “Uraan Pakistan” program, partnerships with Oxford and Cambridge universities were being pursued to promote research, technology and innovation.
Under an IT industry revival plan, he said more than 20,000 young people were being trained in advanced technologies, with over 14,000 new jobs expected to be created.
The government has said maintaining macroeconomic stability while gradually lifting growth remains its central challenge as Pakistan moves into 2026, with officials emphasising disciplined spending, export growth and job creation as key priorities.
