The federal cabinet has approved a presidential ordinance to increase the price of electricity by a total of Rs 5.65 per unit.
This immediate increase in the price of electricity is being done under the terms of the IMF, which aims to collect additional revenue of Rs 884 billion from power consumers by October.
The increase of Rs. 5.65 per unit will be in six phases which has been approved by the Federal Cabinet through Circulation Summary. The federal cabinet also approved an amendment to the NEPRA Act through a presidential ordinance, which would give the government the power to impose an additional 10% surcharge on electricity to increase revenue and increase the price of electricity by Rs 1.40 per unit. ۔
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Its purpose is to implement a circular debt program approved by the federal cabinet. Following the approval of these ordinances by the Cabinet, the Resident Representative of the IMF, Teresia Daba, tweeted “Long live Pakistan”.
According to sources, Pakistan has fulfilled all the conditions of the IMF loan and the IMF is likely to approve the loan installment for Pakistan next week. The increase of Rs 5.65 per unit in the price of electricity is aimed at a 36 per cent increase by deducting tax from the bills. According to the circular debt management plan, from April 2021, the increase in electricity prices will be in six phases which will continue till June 2023.
The price of electricity will be doubled under annual tariff adjustment and 4 quarterly adjustments. After that, with the inclusion of a 10% surcharge, the price will increase by Rs 7 per unit, which will impose an additional burden of Rs 934 billion on consumers. The government has increased the price of electricity by Rs 1.95 per unit under the annual tariff only last month. Adding the additional cost will bring the total increase in the price of electricity to Rs. 8.95 per unit and consumers will be charged an additional Rs.