Business
Govt drops gas bomb as tariff hiked up to 193%
BUSINESS
Tuesday, October 24, 2023
Govt drops gas bomb as tariff hiked up to 193%
- Gas tariff hiked up to 173% for non-protected consumers.
- Fixed charges for protected consumers revised upward to Rs400.
- Exporters manage to avoid massive gas tariff hike.
ISLAMABAD: The government on Monday finally okayed a massive hike in gas tariff, giving a massive blow to the inflation-weary masses that is likely to add to their miseries.
The Economic Coordination Committee (ECC) of the Cabinet, which met in the federal capital with Finance Minister Dr Shamshad Akhtar in the chair, gave approval for the hike in the gas tariff up to 193% starting from November 1, 2023.
The development comes ahead of the International Monetary Fund (IMF) review scheduled later this month that had asked Pakistan to cut the ballooning circular debt in the energy sector.
As per the approved summary, the fixed monthly charges for protected consumers were revised upward from Rs10 to Rs400 and for non-protected from Rs460 to Rs1000 and for higher slabs up to Rs2000.
The government has hiked the local gas tariff up to 173% for non-protected domestic consumers, 136.4% for commercial, 86.4% for export, and 117% for the non-export industry.
The exporters have managed to get maximum benefit as their tariff will go up by 86% with effect from November 1, 2023.
Earlier, it was proposed to hike the average tariff from October 1, 2023, but the ECC granted its approval with effect from November 2023.
According to the Ministry of Finance, the meeting considered various agenda points and summaries submitted by different ministries.
The Ministry of Industries and Production submitted a summary regarding the measures to meet the requirements of urea for Rabi season 2023-24. The ECC discussed the proposal in detail and approved the immediate import of 200,000 tonnes of urea fertilizers.
It also directed to ensure an uninterrupted supply of gas for the fertilizer industry. It was also decided that the provinces would be asked to act more proactively to bear the importation cost.
The meeting also deliberated over a summary submitted by the Earthquake Reconstruction and Rehabilitation Authority (ERRA) for approval of the Technical supplementary Grant of Rs484 million to meet critical expenditure on pay and allowances of 415 contract and project employees from July 2023 onwards.
The ECC directed the Ministry of Planning, Development and Special Initiatives to identify the savings to finance the salaries of the ERRA employees.
A summary of the Ministry of Finance regarding the establishment of the National Credit Guarantee Company Limited to support the credit enhancement of the Small and medium enterprises (SMEs) was also considered and approved by the forum.