The government was expected to reduce the power tariff by up to RS1.71 per year. Unit for all consumers of power distribution companies (discos) and K-electric (KE) for the next three months as part of a freedom of duty that was probably announced after Eidul Fitr, sources said Friday.

They said the National Electric Power Regulatory Authority (NEPRA) was set to allow the increase in tariff differential subsidy (TDS) with RS1.71 for all consumers in the months of April, May and June. They added the reduction would be part of the plan to reduce the power tariff by up to the RS6 per year. Unit.

The federal cabinet in its meeting on March 26 approved the increase in TDS for all consumers, except lifeline domestic users, with RS1.71 per year. Kilowattime (kWh) for the April-June quarter of the current financial year, in line with the effort to reduce consumer end-tarif and improve demand.

According to a proposal submitted by the federal government with NEPRA, the increase in TDS aimed at balancing fiscal burden and maintaining the sustainability of the electricity sector. Nepra has planned a public consultation on the proposal on April 4.

According to Nepra’s decisions of 11 and 13 July 2024 and announced by the federal government, the national average rate for FY 2024-25 RS35.50 per year was Unit. However, the government informed the national average duty of RS32.99 per year. Unit while they brodged the gap through TDS.

In addition, the government has maintained a uniform consumer-end customs for KE consumers through the incorporation of TDS. Extra TDS per Unit for all consumers of discos and ke, except Lifeline Domestic, were estimated at RS1.71/kWh for April-June 2025.

Once considered and approved by NEPRA after the public consultation, a notification would be issued by the federal government to change the existing rates stated on July 14, 2024 in the extent of the subsidy help, the sources say.

Finance Minister

The government plans to lower electricity costs as part of a wider plan to bring relief to producers and increase exports, in a step that comes shortly after reaching an agreement to lock more cash from the International Monetary Fund.

The government is planning to soon submit a message on lower electricity parlors, federal minister of finance and revenue, Senator Muhammad Aurangzeb told Bloomberg in an interview on the sidelines of the Boao Forum in China.

It goes together with other efforts to lower financing costs and taxation burdens to help the production sector increase production and overseas sales, he said.

“Basically, the DNA of the economy needs to be changed to make it the export led,” Aurangzeb said.

“On the energy side, we work under the Prime Minister’s leadership to reduce customs, and the prime minister will give a message about it in the coming days.”

The government is currently putting together a budget that expands the tax base by including sectors such as real estate, retail and agriculture, Aurangzeb said.

It could allow officials to reduce the burden of the manufacturing sector, which has paid disproportionately high taxes, he said.

The State Bank of Pakistan has already dropped its most important political rate to 12% from 22% last April, but unexpectedly this month had its benchmark rate.

Aurangzeb said that although political rates are the central bank, he sees more room for them to come down later in the year.

“Given where the headline inflation is where the core inflation is, I expect that during this calendar year we will see the rates moving forward,” he said.

In the fourth quarter, Pakistan plans to launch its first Chinese yuan-denomine bond in the range $ 200 million to $ 250 million to finance climate-related projects, Aurangzeb said.

While Pakistan is already strong debt to China’s development banks for infrastructure projects, it is important for the country to diversify its financing bases beyond the United States, Europe and Islamic Sukuks, he said.

“It’s time we are now pressing the second largest and deepest capital market in the world,” Aurangzeb said.