The government is set to withdraw subsidies available to electricity consumers on a monthly consumption limit of 201 to 300 units, reported Business Recorder.
The proposed subsidy plan for the fiscal year 2021 will target residential electricity consumers with an average of 300 units of consumption per month. This will result in a financial impact of nearly Rs. 19.5 billion.
The introduction of more tariff slabs for larger consumers is also on the cards. Agriculture tube-well consumers will also be targeted for subsidy. Furthermore, zero-rate subsidies will be linked to actual exports.
The current level of subsidy has been calculated at Rs. 421 billion. Out of this, Rs. 26 billion is for 3,936 zero-rated industrial consumers, Rs. 38 billion for Azad Jammu and Kashmir, Rs. 18 billion for 402,000 ex-FATA-residential consumers, and Rs. 36 billion for Industrial Support Package (ISP) to be given to 337,000 industrial consumers.
For 18 million consumers, using 1-100 units monthly, a subsidy of Rs. 65 billion has been decided. For 5 million domestic consumers with monthly consumption of 101 to 200 units, a subsidy of Rs. 78 billion has been decided. Additionally, Rs. 59 billion has been kept in subsidy for consumers with monthly usage of 201 to 300 units.
The Federal Government is also extending a Rs. 26 billion subsidies to 2 million consumers of Karachi Electric.
In the agriculture sector, subsidies of Rs. 23 billion are reserved for 29,000 agriculture consumers of Balochistan. For agriculture consumers in other distribution companies (Discos), Rs. 63 billion has been kept for subsidy.