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Print Print 2023-11-14

‘Winter package’ not allowed to see the light of day

  • Govt fails to secure nod for industry package from IMF, sources says
Published November 14, 2023

ISLAMABAD: The federal government has reportedly scrapped the proposed Winter Package for industry across the country after its failure to secure nod from the International Monetary Fund (IMF), well informed sources told Business Recorder.

Finance Division had also termed the “shelved” four-month electricity ‘winter package’ for industry on incremental consumption as “vague and in violation of international commitments.”

Power Division had tailored three options for country-wide implementation of the four month (November 2023 to February 29, 2024) winter package for industrial electricity consumers on incremental consumption, which however, will hit other categories of consumers.

Industrial consumers: Three options tailored for ‘winter package’

Option-1 Power Division proposed relief from Rs 3.32 per unit to Rs 7.86 per unit’. Option-2 Rs 8.57 per unit to Rs 14.13 per unit relief, and Option 3, relief from Rs 12.28 per unit to Rs 17.84 per unit. Power Division argued that any increase in electricity demand during winters will not only enable optimum use of system generation capacity but will also help in reducing gas demand due to shifting of favourable demand towards electricity.

On October 25, 2025, Finance Division in its comments stated the proposal seems to suggest cross subsidisation of industrial tariff by all other consumers despite the fact that the GoP has undertaken to avoid any cross subsidisation under international commitments and queried how will the proposal address that issue.

On October 31, 2023, Finance Division in its comments clearly stated that quarterly adjustment and FC surcharge would be recovered on incremental consumption. Finance Ministry had also sought quantifiable economic benefits on the earlier approved industrial support packages and incremental consumption.

It was also made clear that no additional financial implications on subsidy payable to Discos and K-Electric for the Federal Government would be provided nor would it add to the stock of the circular debt.

Finance Division further sought confirmation from the Power Division that the proposal is not in conflict with the understanding reached with International Financial Institutions (IFIs) under the Standby Arrangement (SBA).

The sources said the proposal of Winter Package was also shared with the visiting IMF team during ongoing talks, which did not give its consent, indicating that the package will be scrapped.

Copyright Business Recorder, 2023

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Usman Nov 14, 2023 09:52am
Time for the rich to face what the average and poor are facing .
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Kashif ALI Nov 14, 2023 12:58pm
That is correct decision for scrapping Cross-subsidy schemes of such sorts.
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