It is worth mentioning here that due to the continuous increase in electricity and gas prices during the last few years, where the work in the industry has come to a standstill, the payment of gas and electricity bills for the common man as well as for the industrialists and businessmen has become difficult.

It has become a big economic problem. This situation did not arise in a day but it is the result of mismanagement and wrong policies of the last three decades that we are suffering today.

In such a situation, if the current government also continues to follow the policy of maintaining this old way, then it can be said with certainty that very soon this economic problem can cause anarchy in the country.

 The main reason for this is that despite the rate at which electricity and gas are being supplied to the industry, it has become impossible for the industry to continue the production process.

In the past, every government has been increasing the prices of electricity, gas and petroleum products to pay the interest after taking loans from the IMF, but this has resulted in high prices of energy. Even under the current minimum wage law in the country, if the prices of electricity and gas are examined, it is a fact that it has not been possible for households earning 30 to 40 thousand rupees per month to pay thousands of rupees per month for electricity and pay extra for gas bills.

On the other hand, another major policy contradiction of the energy sector in Pakistan is that instead of providing convenience to consumers for their overuse of electricity in summer and gas in winter, the rate are further extended. This policy with regard to gas is understandable to some extent because due to the decrease in natural gas reserves, Pakistan has to import LNG from abroad for its own use, therefore saving in gas rushing or consumption is necessary.  However, in the case of electricity, this policy cannot be described as desirable in any way. If the government has to pay the private companies producing electricity in the name of capacity charges according to their full capacity, then putting this electricity into use. Private power generating companies should not continue to fill their pockets in the name of capacity charges without generating power Though our country is in energy crisis for quite some years, but for the last few years, the  crisis is getting worse with the pasage of time. Till now, Southen Gas was mostly in the news, but now Sui Northern Gas has asked for a third hike in gas prices in a year. Its prices are being hiked by 155 percent from July 1.

As reported, the PM Shehbaz Sharif has expressed his anger on this and has asked for a forensic audit of the recent increase in prices, a report on infrastructure, gas theft and poor performance in three months.  In view of these conditions, the importance of Pak-Iran gas project has doubled.

The Prime Minister has also directed to immediately set up an international ministerial commission to monitor the project. Petroleum Minister Mossadiq Malik also expressed his concerns and said that as the value of the dollar has decreased, more companies are asking for an increase. The revolving credit in the energy sector has reached 5 thousand billion rupees. He said that the government has decided to seek exemption from the US on the Pakistan-Iran gas pipeline project.

Pakistan cannot afford sanctions. We will put our position in front of America. We will try to get exemption by giving full lobbying and political and technical arguments. He said that we have told Iran several times that we need your gas. We want to complete this project without any restrictions.  We will also request relaxation so that this project can be completed. Construction can start soon. It is true that there is a lot of inflation in the country, cheap gas is our compulsion, Pakistan has a big advantage in buying gas from Iran, but the facts on the ground are that we cannot anger America in the current situation, but we can convince it.  The caretaker government had approved the construction of the line but had delayed plans to file a petition against US sanctions due to the geopolitical situation. This project has been pending since 2009.  Meanwhile,  financial experts say that Prime Minister Shehbaz Sharif's expression of indignation over the recent increase in gas price is natural. When gas deposits were discovered at Sui in the early years of Pakistan's formation, gas was seen as a cheap fuel. It was believed that these reserves would be enough for the needs of the country for  decades. But at that time the population of the country was small and perhaps the estimators did not have a correct estimate of the extraordinary increase in the population.

At present, the situation is that the country's gas reserves are scarce, the amount of newly discovered gas is less, while the dependence is more on the import of gas from abroad. A plan to send gas through a pipeline is on hold due to the situation in Afghanistan, while the US sanctions have blocked the Pak-Iran gas pipeline.  Containerized gas is no longer available at the old cheap rates. This requires serious foreign exchange. The terms of the hike in electricity and gas rates by the IMF have been relaxed.

In this scenario, gas prices have skyrocketed and have increased by hundreds of percent over several months. A rate hike request by Sui Northern Gas is also pending before the Oil and Regulatory Authority (OGRA).  In this situation, the Prime Minister has decided to review the performance of Ogra and gas companies. According to the sources, a forensic report has been called for the recent increase in gas prices in a month.  It has also asked for a report on gas infrastructure, gas theft and poor performance in 3 months and has directed to immediately set up an inter-ministerial commission to monitor the Pak-Iran gas pipeline project.  It is expected that these steps will lead to improvement in the situation.

The completion of the contracts with Turkmenistan and Iran for many years can provide consumers with cheap gas. To deal with the energy crisis that has been going on for more or less two decades, Pakistan has started plans to get natural gas from Turkmenistan and Iran through a pipeline, which should have been completed by now.  Both have been delayed for a long time due to tension. If they were completed in time, not only gas would be available 24 hours a day, but domestic and foreign industrial production and commercial activities would continue without interruption.

Published in The Daily National Courier, April, 01 2024

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