The federal cabinet, under the leadership of Prime Minister Shehbaz Sharif, has approved revised agreements with 14 independent power producers (IPPs), which could lead to a reduction in electricity prices by up to Rs 11.
According to Express newsthe Cabinet meeting approved the proposal to review the contracts of the 14 IPPs based on the recommendation of the Power Division. As a result of these revised agreements, a reduction of Rs802 billion in profits and costs was agreed for these IPPs.
The statement issued indicates that an additional Rs 35 billion will be drawn from the additional profits of these IPPs earned over the past years. Ten of these IPPs operate under the 2002 Electricity Policy, while four are part of the 1994 Power Policy.
Moreover, under the 1994 policy, one of the IPPs had its contract cancelled. The revised agreements with these IPPs are expected to result in total savings of Rs 1.4 trillion over the current contract period, with an annual savings of Rs 137 billion, benefiting consumers.
Hailing the revised agreements as a significant success, Prime Minister Shehbaz said they would not only save the national treasury but also help eliminate circular debt and reduce electricity prices.
The government also approved the merger of the Ministry of Narcotics Control with the Ministry of the Interior, as part of the government’s right-sizing initiative.
The Anti-Narcotics Department will now function as a wing of the Ministry of Home Affairs, while the Anti-Narcotics Force (ANF) will be an attached branch of the Ministry.
This merger is expected to save the national exchequer Rs183.25 million annually in administrative matters, salaries, office maintenance and other operational costs.
In addition, the Cabinet approved the merger of the Aviation Division with the Defense Division. This decision follows the principle of fiscal austerity, as Civil Aviation Affairs was previously managed under the Ministry of Defense until 2013.
The merger aims to improve airspace management and is expected to save Rs145 million annually in similar operating expenses.
Other cabinet approvals
Rules for public procurement: The Cabinet, based on a recommendation of the Cabinet Division, approved the addition of Section 45-A to the Government Procurement Rules, 2004. This section allows a procurement agency to delegate all or part of its procurement process to another agency.
National Commission for Minorities: The Cabinet also approved the National Commission for Minorities Act 2024 to be sent to Parliament for consideration as per the recommendation of the Ministry of Human Rights.
Extension of service: The Cabinet gave an extension of two years to Dr. Muhammad Bashir’s contract as a member of the Technical Environmental Court, Islamabad, on the recommendation of the Ministry of Law and Justice.
