Federal cabinet approves hike in electricity tariff
95% consumers won't be affected by power tariff hike, Asad Umar said.
ISLAMABAD (Dunya News) – The federal cabinet has approved Rs1.27 per unit hike in electricity tariff on Thursday.
While addressing a press conference after the meeting, Finance Minister Asad Umar said consumers using less than 300 units per month that are equivalent to 100 million consumers will have no impact of price increase. He said rates have been increased by ten percent for consumers using from 300 to 700 units of electricity per month while an increase of 15 percent is those who utilize more than 700 units a month.
The Finance Minister further informed that no increase has been made in price of electricity for commercial consumers who use connections less than 50 KV. They are equivalent to 95 percent of businessmen.
He said the cabinet decided to continue the subsidized agriculture rates of 5.35 rupees per unit, reduced from 10.35 rupees, for the whole financial year.
NEPRA had recommended 3.82 rupees per unit increase in the price of electricity. This was determined in August this year, before the current government assumed power, he added.
Asad Umar said government is making efforts to give support to the exports industry to enhance its share in the national income. He said 78 paisa per unit is being increased for industry. Asad Umar said no increase will be made in electricity prices for school, hospitals and other institutions.
He said 140 billion rupees have been saved this year due to improvement in electricity distribution system.
Asad Umar said loss to the tune of 453 billion rupees was witnessed in power sector last year which could reach 550 billion rupees this year if no steps are taken to check this. This loss puts additional burden on ordinary consumers in the form of enhanced rates of electricity or government taking more foreign loans.
He said despite steady increase in oil prices worldwide, the prices of petroleum products in Pakistan have not been increased by the government.
Replying to a question, Finance Minister said Pakistan and Saudi Arabia are brotherly countries with deep bonds of religion, history and culture. He said Pakistan will act as a bridge to develop friendship between Muslim countries and will not be part of any campaign to harm any brotherly Muslim country.
Clarifying to a questioner on the financial package agreed with Saudi Arabia, the Finance Minister said 3 billion dollars will be placed with State Bank of Pakistan. In addition, facility of buying oil from Saudi Arabia worth 3 billion dollars on deferred payments has been agreed. This facility is for three years and would translate to 9 billion dollars in total.
He said government is exploring various avenues for its financing needs and IMF is one of these.
