TIP raises its concerns over proposed changes in Nepra Act

ISLAMABAD: Transparency International Pakistan (TIP) has approached the Prime Minister, against what it called government’s plans to empower Power Division to use Federal Government’s authority to influence power regulator (Nepra) through amendment in Nepra Act.

According to a letter written to Advisor to the Prime Minister Dr. Tauqeer Shah, TIP stated that it had received a complaint against Nepra Amendment Bill 2026, raising serious concerns about undermining the decision of the federal cabinet to issue policy directions to Nepra.

The complainant has made the following allegations: (i) National Assembly (NA) Standing Committee on Power has approved NEPRA Amendment Bill 2026. Under the proposed changes, the term “Federal Government” is being replaced with “Power Division” or “Division concerned” for the approval of various regulatory proposals; (ii) historically, tariff notification under Section 31 has always involved federal government oversight, maintaining collective responsibility and an additional layer of accountability. Replacing this framework with authority vested in the “division concerned” raises legitimate questions about concentration of power and transparency; (iii) regulatory decisions require insulation from departmental priorities. Placing Nepra under the direct influence of the ministry would compromise its ability to make impartial, technically sound, and cost-reflective decisions, thereby weakening confidence in Pakistan’s power sector governance framework; (iv) such subordination will also raise concerns about politicisation of tariff determinations and regulatory decisions, which must remain insulated from short-term administrative or political pressures; (v) The World Bank has also held a meeting with the concerned authorities and conveyed its concerns regarding the proposed replacement of the term ‘Federal Government’ with Division; and (vi) if regulatory independence is reduced, subsequent safeguards will not prevent future governments from influencing tariff determinations, delaying regulatory decisions or creating preferential treatment for selected market participants.

TIP further maintained that the existing policy direction powers available to the Federal Government under Section 31 provide the Cabinet, which comprises of public representatives, with greater authority over the Power Division/Nepra, and if eliminated, will reduce oversight of the cabinet which serves as an important layer of transparency and accountability.

Transparency International Pakistan has requested the Prime Minister to look into the allegations of the complaint and issue directives to halt the proposed amendments undermining oversight of the Federal Cabinet.

The World Bank (WB) has also reportedly raised concerns over proposed amendments to the Nepra Act, 1997, and the Electricity Act, 1910, which may compromise the independence of Nepra.

Under the proposed changes, the term “Federal Government” is being replaced with “Power Division” or “division concerned” for the approval of various regulatory proposals.

The country’s business community and industrial sector have also expressed serious concerns over the Power Division’s move, warning that it could force the regulator to compromise its independence.

Power Division argued that the primary purpose of the proposed amendments is to remove procedural difficulties and avoid unnecessary administrative delays. Following the Mustafa Impex judgment, the Federal Cabinet directed all ministries to review existing laws, rules, and regulations to ensure that routine and technical matters are not escalated to the Cabinet where such escalation is not required.

Accordingly, the amendments mainly replace the term “Federal Government” with “concerned Division” in limited procedural contexts to streamline filings, notifications, and technical reviews, without altering the substantive regulatory framework.

Copyright Business Recorder, 2026