Notifying new gas tariffs every six months throughout a fiscal year is something Pakistan has failed to do, according to the International Monetary Fund (IMF).
The IMF’s’sission asked the caretaker government to implement biannual gas pricing rises at the ongoing first review of Islamabad’s $3 billion standby arrangement in order to reduce the country’s gas circular debt, which has grown considerably since 2013.
The caretaker administration raised gas rates with effect from November 1, 2023, and the IMF was informed of this. According to officials, this will bring in Rs. 980 billion in income in eight months, meaning the government may forgo raising the gas price that is scheduled to take effect in January 2024.
The Fund claims that political considerations prevented the previous administration from boosting gas prices and that in order to keep the Rs. 2.9 trillion in revolving debt in the gas industry under control, the caretaker government presently in place will need to approve a significant rise.
In the meantime, the lender also met with OGRA and asked why, after a 40-day gap, the regulator had not informed them of gas pricing. The Fund was advised that without the required directives from the government, the regulator is unable to carry out its task.
