The caretaker government, responding to demands from the International Monetary Fund (IMF) amidst the ongoing economic crisis, approved a gas price hike, burdening the masses further. The Economic Coordination Committee (ECC), chaired by Finance Minister Dr. Shamshad Akhtar, sanctioned a slight increase in tariff for protected consumers by 40 to 66.67%, with exact details known only to the interim finance and energy ministers. Final decisions will be made by the federal cabinet, with potential approval expected on Thursday.
The tariff adjustments were made to meet IMF deadlines, with no hike proposed for roti tandoor, commercial, power, and cement sectors. However, the gas tariff for compressed natural gas (CNG) was approved to increase to Rs3,750 per MMBTU from Rs3,600 per MMBTU, and for the fertilizer sector, tariffs were suggested at Rs750 per MMBTU for Engro and Fauji fertilizers. The impact of reduced tariff increases for protected consumers will affect fertilizer plants.
The Federal Minister for Finance, Revenue, and Economic Affairs, Dr. Shamshad Akhtar presided over a meeting of the Economic Coordination Committee (ECC) of the Cabinet at Islamabad dated February 14th, 2024. pic.twitter.com/AjBUV9EOB4
— Ministry of Finance, Government of Pakistan (@Financegovpk) February 14, 2024
Non-protected domestic consumers face tariff increases ranging from 5 to 66.67%, with varying rates based on consumption levels. For example, those consuming up to 0.25hm3 will see a 66.67% increase to Rs500 per MMBTU, while those using 2hm3 will experience a 21.87% increase to Rs1,950 per MMBTU. Consumers using over 4hm3 will face a 5% increase to Rs4,200 per MMBTU.
Overall, the ECC’s decision impacts various sectors and consumer groups, aiming to meet IMF criteria while balancing the economic challenges faced by the populace.
