The gas slap

The government’s decision to drastically increase the prices of gas for both domestic and industrial consumers is no less than a disaster. The bid is intended to raise around Rs310 billion in a desperate attempt to secure a fresh tranche of $1.2 billion from the IMF. The stringent conditionalities from the lender will lead to bleeding of consumers under the reconfigured irrational slabs, making their lives horrible. People are already reeling under a staggering inflation of around 30% which will now skyrocket to any extent as production units too will pass on the buck to the end-consumers. What is more painful and contestable is the cabinet’s decision to hike natural gas prices in the range of 16 to 112.32% with retrospective effect from January 1 for six months. This will also have a negative impact on electricity, which is mostly produced by gas, shooting the bills out of proportion.

The prescription of minimum slab for residential consumers is another enigma. The fact that the ceiling has been lowered from 50 to 25 units per month means more inflated bills despite lower consumption. This is untenable, and the new price mechanism on four proposed slabs for so-called protected and six modules of non-protected consumers is nothing but a jargon of confusion. Moreover, the fix-rate collection on gas coupled with its trickling down effect on purchasing power is certainly unbearable for millions of daily wagers and salaried class. Though the ruling dispensation seems to be in a do or die situation, its dovetailing into politics and society will be a daunting challenge, and will surely come with a public backlash.

Pakistan has a serious energy crisis. It is crisscrossed on two fronts: one, securing adequate energy avenues and that too at a bearable cost; and two, to settle down on a rational price tariff without giving in to international and local dictates. This is where the growth, production and lifestyle rest. The convention of raising energy prices for budget arithmetic is unproductive.

Published in The Express Tribune, February 15^th, 2023.

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