Pakistan’s Relief Package for Electricity Bills 2024 By PM Shahbaz

The current Prime Minister of Pakistan Mr. Shehbaz Sharif has assured a huge subsidy package especially for the electricity bills for the masses of Pakistan. This plan is for assisting whoever has had the challenge of expensive electricity tariffs imposed on them. Government will for the first three months offer subsidies to consumers with a take home rate of 200 units or less per month. This is what you should know about this initiative, its advantages, and the imperative
behind it. Let’s discuss the Relief Package for Electricity Bills 2024.

Key Points of Announcement:

• Mr. Sharif has promised sixty five billion rupees package for household electricity
  consumers.
• Use electricity not more than 200 units in a month.
• For the above said category of consumers, the cost per unit electricity will be ranging
  between Rs. 4- Rs. 7.
• Subsidy plan is also beneficial to the consumers of K-Electric so it does seem like a good
  idea.
  Details of the Relief Package
  Point Details
  Duration Three months: July, August, and September
  Beneficiaries Consumers using up to 200 units of electricity per month
  Cost to Government Rs 50 billion
  Purpose Financial relief during high electricity costs and economic challenges
• Relief Package for Electricity Bills 2024.

Why the Subsidy Was Introduced

This hike was demanded by the International Monetary Fund (IMF) for Pakistan to get bailout money. Rates were raised significantly affecting most households especially those with low income levels. This subsidy should help to alleviate that situation and give some measure of respite to the people.

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Economic Context:

• IMF Conditions: The implementation of the increase of tariffs was a condition from the
• IMF to support the stabilization of the Pakistan economy.
• Public Response: This resulted in dissatisfaction and protests among the people.
• Government’s Response: The subsidy will make sure that there is a compromise between
• the economic aspects and the interest of the people.

This subsidy will work in the following procedures:

Federal government will finance the three month subsidy from the head of development known as Rs 50 billion. This will mean that people will not feel the increased cost of electricity especially those who use electricity up to 200 units per month. The saving made by prospecting the electricity bills from Rs.4 to Rs.7 per unit will be a great economical boost to many consumers.

Implementation Details

•  Funding Source: The subsidy will be financed through the development budget which is
• inclusive of the Grant of 100 million Euro for development cooperation and Networking
• of European NGOs active in development cooperation.
•  Total Cost: The estimated cost is around fifty billion rupees recently foray has join to
• competition of mobile phone in Pakistan.
•  Beneficiaries: The subsidy according to the source wants to extend to 94% of household
• electricity consumer.

Benefits to Consumers

•  Financial Relief: The current electricity tariffs and prices are still substantially high, thus
• the reduced tariffs will afford the low income earners a realizable cost.
•  Affordability: Erratic increase for electricity will be controlled and therefore families
• will have to spend less money.
•  Peak Consumption Support: It is paid to consumers in the summer season when usage
• of electricity is more.

Broader Economic Context:

The previous attempt to increase energy tariffs was also to seek IMF funding and attempt to
stabilize Pakistan’s economy. But this increment put a pre-stage pressure on both sets of users –
protected and unprotected – bearing high tariff rates for electricity consumption at various
categories. Three months subsidy is considered to be a compensational measure since the tariff
hikes have an impact on a client’s outcome and is a financial burden.

Strategic Context

 IMF Assistance: The hike in tariff was necessary so as to obtain the IMF funding.
 Public Backlash: taxes that led to increased tariffs elicited a lot of protest from the
public against the government.
 Corrective Measure: There is evidence that the subsidy is part of the government’s
unplanned mechanism of adjusting the economy’s requirements regarding the
responsibility to the people.

Conclusion

The three months electricity tariff subsidy for the protected users is considered very useful and
generous steps by the government of Pakistan to relieve its citizen financially. This policy
indicates the government’s standpoint in increasing disposable income to the low income
households within the backdrop of high utility bills and other economic hardships. In its
provision of this subsidy, the government wishes to make sure that protected consumers can be
able to handle the power bills in the hotter summer months.