Industry gets power relief as PM cuts electricity tariff by Rs4.04

ISLAMABAD: Prime Minister Shehbaz Sharif on Friday announced a PKR4.04 per unit cut in electricity tariffs for industries, calling it a critical step to ease production costs and revive economic activity, even as he admitted that deeper cuts were constrained by fiscal realities.

‘Wanted to cut Rs10, but hands are tied’

Addressing an event, the prime minister said he had wanted to reduce electricity prices by Rs10 per unit but was unable to do so due to existing limitations. He also announced a Rs9 reduction in wheeling charges for industrial consumers, saying the combined relief package was aimed at improving competitiveness and supporting industrial expansion.

Exporters get tax relief, blue passports

In further relief for exporters, Shehbaz Sharif said the tax rate for exporters would be slashed from 7.5pc to 4pc, describing the move as a major incentive for the export sector. He reiterated that award-winning exporters and leading business figures would be issued blue passports for two years, terming exporters and traders the “crown jewels” of the economy.

He said economic policies would be framed in consultation with the business community, stressing that their role in national growth was becoming increasingly central. He praised exporters for performing strongly despite difficult conditions, noting that exports saw a marked increase in 2025 and brought billions of dollars into the country.

‘Global perception of Pakistan has changed’

Reflecting on the broader national context, Shehbaz Sharif said Pakistan’s recent success during tensions with India had altered global perceptions. “Pakistan delivered a defeat that even future generations will remember,” he said, adding that the country now commanded respect internationally. He said he personally observed a shift in attitudes towards Pakistan during foreign visits after Ma’araka-e-Haq.

From default fears to stabilisation

Turning to the economy, the prime minister recalled a period when Pakistan was widely being described as on the brink of default, with some claiming it had technically gone bankrupt. He said saving the country from default was one of the biggest challenges faced by his government, particularly after tough discussions with the IMF during the 2023 Paris Summit.

He thanked friendly countries, including China, Saudi Arabia, Qatar and the UAE, for supporting Pakistan at a critical time. He remarked that seeking financial assistance often came at the cost of national self-respect, citing Sri Lanka’s experience as a cautionary example. Eventually, he said, the IMF approved a programme for Pakistan.

Inflation down, reserves doubled

Shehbaz Sharif said the economy had now stabilised, though he acknowledged that conditions were still far from ideal. He pointed to key indicators, including single-digit inflation, a drop in the policy rate from 22pc to 10.5pc, and foreign exchange reserves doubling, as signs of improvement. However, he warned that without further easing of interest rates, economic capacity could not expand fully.

Privatisation, reforms and anti-corruption drive

The prime minister said difficult decisions were beginning to yield results and urged industrialists to take bold steps in line with the finance minister’s guidance. He added that he and the field marshal had visited several countries to present Pakistan’s economic roadmap, while conceding that exports in several sectors had yet to pick up.

He said the government was making its first serious attempt to cut expenditures, pursue privatisation for greater transparency, and reduce taxes to attract investment, citing the privatisation process of PIA as an example.

Defending the closure of utility stores, he cited corruption and the indignity faced by citizens standing in long queues. He said action had also been taken against corruption in Pasco and the sugar sector, recovering Rs50 billion from sugar mills, and credited the field marshal with playing a key role in curbing smuggling, including petrol smuggling.

Concluding on a lighter note, Shehbaz Sharif praised several cabinet members for their performance and joked that he hoped he had not forgotten to commend anyone, lest they take offence.