Islamabad, July 24, 2025 — The International Monetary Fund (IMF) has rejected Pakistan’s Energy Ministry proposal to introduce a three-year marginal electricity tariff package aimed at stimulating industrial growth, AI development, and data mining operations, citing concerns over incomplete recovery of dues, according to informed sources .
Under the proposal, Pakistan planned to capitalize on an estimated 8,000 MW surplus in its national grid by offering participating industrial and tech sectors electricity priced at marginal cost—covering only production charges and capacity costs—while waiving taxes and other levies . The scheme also included reduced per-unit taxes for incremental electricity use beyond regular consumption .
However, the IMF expressed reservations, emphasising that without full assurance of cost recovery, the plan could undermine the financial health of Pakistan’s energy sector . The Fund has stipulated that any marginal cost pricing must be accompanied by mechanisms ensuring 100% collection of dues, including production and capacity charges .
In response, the Energy Ministry is preparing to revise its proposal to address the IMF’s concerns. Officials expect to present an improved version during the next round of economic review talks .
This pushback from the IMF comes as Pakistan braces for the expiration of several electricity tariff relief measures by month’s end. Adjustments ranging from Rs 1.55 to Rs 4.51 per unit and additional fuel-charge concessions are set to lapse, triggering anticipated tariff increases for consumers .
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A senior official within the Energy Ministry commented, “We are confident that demand from industries, AI centres and data-mining operators will match available grid surplus. However, the IMF’s guarantee for full recovery remains our gatekeeper.” Analysts note the challenge Pakistan faces: balancing subsidies aimed at accelerating industrial and digital growth with fiscal discipline and energy-sector sustainability.
Economists warn that failure to recover full revenues could exacerbate existing circular debt and further destabilize a sector already under financial strain. As talks progress, all eyes will be on whether Pakistan can deliver a revised plan that satisfies both economic growth objectives and IMF requirements.