Pakistan-IMF Talks: Fund Demands End to 200-Unit Power Subsidy

At a glance

IMF demands end to power subsidy for consumers using up to 200 units.
Talks for $1.2bn tranche at critical stage over privatization and circular debt.
Government plans to privatize most state-owned firms by December 2027.

Story so far

Pakistan is in crucial negotiations with the International Monetary Fund (IMF) for the release of a $1.2 billion loan tranche. The talks, which have moved from a technical to a policy level, are focused on key economic reforms. The IMF has expressed concerns over Pakistan's circular debt, the pace and mechanism of privatizing state-owned enterprises, and subsidies in the energy sector.

Latest development

The IMF has demanded an end to the electricity subsidy for consumers using up to 200 units and raised objections to the government's privatization plan for power distribution companies, as policy-level talks for a $1.2 billion tranche continue in Islamabad.

Responses

Sami Rafiuddin 2 hours ago

Ending the subsidy for consumers using up to 200 units will be a very heavy burden. I hope there is some thought being given to how the most vulnerable households will manage this change.

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