The International Monetary Fund (IMF) has approved a reduction in electricity tariffs, sources familiar with the matter confirmed on Thursday.
According to the IMF, “The IMF has allowed to reduce Rs1 per unit in the electricity tariffs,” granting this approval to provide some financial relief to consumers.
The reduction will be made possible using funds generated from a levy imposed on captive power plants that use gas.
In addition to this development, the federal government is actively working on a broader relief package for electricity consumers, which will be officially announced once it receives approval from the IMF.
It is worth noting that Pakistan and the IMF had previously reached a staff-level agreement, granting Pakistan access to up to one billion dollars under the Extended Fund Facility (EFF).
The IMF had also highlighted that inflation in Pakistan has dropped to its lowest level since 2015, the country’s economic conditions have improved, and further improvement is expected.
As part of this program, Pakistan is set to receive a total of two billion dollars in financial support.