Business

Gas prices to go up 10-15% as govt aims to reduce circular debt

Published

1 year ago

Farwa

Circular debt currently stands at Rs1,250 billion.
Govt officials say govt is contemplating an increase in gas prices.
An increase of just 5% to generate Rs50 billion is likely, they add.

ISLAMABAD: The government is likely to hike gas prices by 10% to 15% in its bid to reduce circular debt that currently stands at Rs1,250 billion, The News reported on Thursday.

The decision comes after the International Monetary Fund (IMF) asked Islamabad to hike natural gas prices from January 1 next year. The lender is, however, aware of the government collecting Rs980 billion in revenue during the ongoing FY24 owing to the massive hike in gas prices by up to 193%.

“The authorities are contemplating an increase in the natural gas sale price by 10-15%, which will yield Rs100 billion in additional revenue. It is to be used for slashing the natural gas circular debt. However, the final decision to this effect has not been taken so far,” senior government officials of the Energy Ministry told the publication, adding that gas prices will increase by just 5% to generate Rs50 billion.

With the massive rise in gas price by up to 193% from November 1, 2023, the government will have surplus revenue of Rs275 billion which will be consumed in paying the Rs210 billion cost to be incurred against the RLNG diversion to the domestic sector in the ongoing winter season. It also offsets the loss of Rs65 billion incurred due to the failure of the government to notify gas price hike four months late.

The gas companies, Sui Southern and Sui Northern will submit their petitions with the OGRA seeking an adjustment in gas prices from January 1, 2023, which will most probably ask for a downward revision of gas prices.

However, the Fund wants the government to further increase gas prices by 10-15% from January 1, 2024. The Fund pinpointed that the government has failed to hike the gas tariff biannually for the last 10 years since 2013, causing a massive buildup in the gas circular debt.

Business

February 7, 2025: The value of the Pakistani Rupee (PKR) in relation to the US dollar is unchanged.

Published

1 day ago

Farwa

KARACHI: The open market exchange rate between the US dollar and the Pakistani rupee (PKR) was Rs279.4 on February 07, 2025, with a selling rate of Rs281.1. The interbank exchange rate between the US dollar and the Pakistani rupee is Rs 278.45, according to Interbank.

There was no movement in the US dollar (USD) from the previous closure of Rs278.

Business

The NORINCO Group is invited by CM Sindh to explore opportunities.

Published

2 days ago

Farwa

Chinese companies have been invited by Sindh Chief Minister Syed Murad Ali Shah to visit Karachi and other regions of Sindh Province in order to observe the quickly growing businesses and investigate prospects in fields like clean energy, infrastructure development, and public transit projects.

Speaking in Beijing to a delegation headed by the chairman of NORINCO International Co., Ltd., he stated that all facilities required would be provided by the governments of Sindh Province and Pakistan.

With assistance from NORINCO International, the Sindh Chief Minister stated that the Provincial Government will firmly urge North Vehicle and BeiBen to think about setting up a Vehicle Assembly Plant in the Dhabeji Special Economic Zone.

Business

A deal with Pakistan to fight financial crimes has been approved by the Saudi cabinet.

Published

2 days ago

Farwa

In order to strengthen collaboration in the fight against money laundering, terrorist financing, and associated crimes, the Saudi Press Agency announced this week that the Saudi cabinet, led by Crown Prince Mohammed bin Salman, had approved a memorandum of understanding (MoU) with Pakistan’s Financial Monitoring Unit (FMU).

Due to its severe money laundering and terrorism funding issues in recent years, Pakistan was added to the Financial Action Task Force’s (FATF) grey list in June 2018.

The nation was taken off the gray list in October 2022 after enacting extensive measures to fortify its financial system.

The FMU is Pakistan’s financial intelligence unit, created under the Anti-Money Laundering Act of 2010 and tasked with collaborating with foreign partners and evaluating reports of suspicious transactions.

According to the SPA, “the cabinet approved a memorandum of understanding regarding cooperation in exchanging investigations related to money laundering, terrorist financing, and related crimes between the Financial Monitoring Unit in the Islamic Republic of Pakistan and the General Department of Financial Investigation at the Presidency of State Security in the Kingdom of Saudi Arabia.”

The MoU is an indication of Saudi Arabia and Pakistan’s growing strategic partnership. A significant Pakistani diaspora resides in the Kingdom, and numerous Pakistani businesses have established a presence there.

Saudi Arabia has been a key supporter of Pakistan’s economy, bolstering its reserves with substantial deposits in the State Bank of Pakistan and offering deferred oil payment facilities.