In an effort to lower the spiralling circular debt in the power sector, the caretaker federal government on Wednesday announced plans to initiate a crackdown on electricity theft across the nation.
Govt crackdown against electricity thieves: At a news conference, interim Minister of Information and Broadcasting Murtaza Solangi and Minister of Energy Muhammad Ali announced the measures.
According to the power minister, Pakistan’s ten distribution corporations collectively lose Rs. 589 billion annually. He claimed that the main causes of this enormous loss are electricity theft and unpaid electricity bills.
He stated, “The interim government has prepared a thorough three-pronged strategy to address the issue of power theft.
The minister outlined the steps, stating that they would undertake technology interventions in locations where there is a 15–30% electricity theft rate. Secondly, if power theft ranges from 30 to 60 percent, they will involve the private sector in management, while ensuring enforcement in areas where power theft exceeds 60 percent.
“There is an urgent need to introduce reforms in the energy sector,” he added, noting that the government is evaluating the effectiveness of the Board of Directors of power distribution companies and would modify their management.
It is important to note that the increased electricity prices led to nationwide demonstrations from Karachi to Khyber, some of which turned violent.
“Electricity Bill Protests and IMF Negotiations”
Since the notables’ electricity bills have been exceeding their wages, the protesting masses have been calling on the government to stop giving them free electricity and to give them relief.
The previous statement mentioned that Pakistan’s attempts to persuade the IMF to reduce electricity costs had failed because such a move could endanger the government’s efforts to recover up to Rs6.5 billion.
According to sources closer to the finance ministry, the IMF and Pakistan were unable to come to an agreement on the relief for power bills. Further, According to information obtained, the interim administration informed the Fund in its proposal that the assistance would reduce recovery by up to Rs6.5 billion.
The concept was reportedly rejected by the Fund because it may have reduced recoveries by more than Rs. 15 billion. The IMF also asked Pakistan for a strategy to close the Rs. 15 billion budget imbalance.