The IMF has refused to approve Pakistan’s proposed discounted electricity package aimed at industries, AI projects, and data mining operations, ProPakistani learned on Thursday.
The Energy Ministry’s three-year marginal tariff plan was meant to capitalize on the 8,000 MW power surplus in the national grid. It proposed billing industries only for production cost and capacity charges for additional power usage while waiving taxes and other levies.
Additionally, the plan included reduced per-unit taxes on incremental industrial consumption to boost manufacturing and technology adoption.
But the IMF rejected the plan, arguing that it lacked a mechanism to ensure 100% revenue recovery, which is a key condition of the loan program. The Fund stressed that all power users must fully cover production costs, capacity payments, and taxes to avoid further burdening the energy sector’s finances.
The Energy Ministry is now revising the package and is expected to present an updated version during the next round of IMF review meetings.
Analysts say this rejection could delay potential relief for industries, particularly AI and data-driven projects, which rely heavily on affordable electricity.