Pakistan

Government Raises Electricity Tariffs by 20%, Burdening Middle-Class Families Further

In recent years, the faces we see in the current government were vocally opposing even a single rupee increase in the per-unit price of electricity. They loudly protested and took to the streets, threatening to overthrow the government due to its failure to control rising prices.

However, the situation has drastically changed. Following recent tax hikes that further burden the already struggling masses, the authorities have announced significant increases in electricity prices, further squeezing the paychecks of salaried individuals. According to news reports, the National Electric Power Regulatory Authority (Nepra) has increased the uniform national tariff for the base price of electricity by nearly 20%, enabling electricity distribution companies to collect almost half a trillion rupees more over the next fiscal year.

Starting July 1, the average base tariff for a single unit of electricity will rise from Rs27.78 to Rs35.50. This base price will be further inflated by various duties, taxes, surcharges, and adjustments for fuel and tariffs. As a result, ordinary citizens will bear the cost not only for the fuel, operation, and maintenance required to generate electricity but also for capacity charges promised to power generation companies by past governments and for the theft and transmission losses that distribution companies have long failed to address.

When all these factors are accounted for, the average middle-class consumer will be paying between Rs65 to Rs72 for each unit of electricity used monthly. Meanwhile, the government plans to present this development to the International Monetary Fund (IMF) as a step towards securing additional loans to sustain a clearly failing system for a few more years.

Adding to the frustration of the general public, the government has announced a Rs10.69 per unit ‘relief’ for the industrial sector to enhance its competitiveness. This move exemplifies crony capitalism, where while the average salaried individual struggles with a shrinking real wage amidst relentless inflation, large industrialists receive cheaper electricity, allowing them to increase their profits while contributing minimally to national taxes.

The government’s apparent indifference to the people’s hardships is an understatement. Its financial strategy indicates a lack of interest in pursuing those who evade their financial obligations. Instead, it opts for the easier route, aiming to enjoy its tenure without addressing the systemic issues plaguing the economy.

The situation has prompted widespread public outcry. Citizens, especially middle-class strata are expressing their anger and frustration over social media and in various public forums. Many feel that the government is prioritizing the interests of the wealthy over the needs of the common people. The disparity between the relief given to industrialists and the burden placed on ordinary citizens is seen as a glaring example of the government’s misplaced priorities.

The sharp increase in electricity prices comes at a time when Pakistanis are already grappling with high inflation rates, which have significantly eroded their purchasing power. Basic necessities such as food, fuel, and healthcare have become increasingly unaffordable for many, exacerbating the economic challenges faced by the average family.

Experts warn that the rising cost of electricity will have a cascading effect on the overall economy. Higher electricity bills will increase the cost of production for businesses, leading to higher prices for goods and services. This, in turn, will further fuel inflation, making it even more difficult for families to make ends meet.

Finally, the recent hikes in electricity prices and the preferential treatment given to industrialists underscore the need for a more equitable and sustainable economic policy. The government must prioritize the needs of the common people and take decisive action to address the root causes of the country’s economic woes. Only then can it hope to build a fair and prosperous future for all Pakistanis.

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