Additional power surcharge imposed as Pakistan surrenders to another IMF condition

ISLAMABAD – The federal government has imposed an additional surcharge of Rs3.82 per unit on electricity, in another desperate move for the revival of the IMF stalled loan.

The recent move is said to add citizens' woes but it will generate Rs335 billion more in revenue over the next fiscal year to tackle the debt and liabilities of the power sector.

Economic Coordination Committee (ECC), presided over by Finance Minister Ishaq Dar allowed imposing additional power surcharge.

In a statement, Ministry of Finance said Economic Coordination Committee gave assent to the proposal regarding the enhancement of surcharge for the financial year 2024 to cover federal government obligations towards power producers.

The recent development comes a week after Finance Minister Ishaq Dar refused to accept the demand tabled by IMF. The US-based lender demanded a total surcharge of Rs3.82 per unit to eliminate circular debt accumulation. 

Meanwhile, the monetary policy committee of the country’s central bank is due today as the government is set to raise the key interest rate.

Earlier in February this year, the Sharif-led government allowed an additional surcharge of Rs3.82 per unit from March to June 2023, and also approved a surcharge of Rs1.43 per unit for the next fiscal year to recover Rs126 billion.