Finance Ministry Cuts Energy Subsidies in 2023-24 Budget

Hi Everyone! I hope you are all doing well. Welcome back to another blog. In this blog, we will talk about, Finance Ministry Cuts Energy Subsidies in 2023-24 Budget. In the fiscal budget for the year 2023-24, it has been decided that the Ministry of Energy will not receive a subsidy amounting to more than Rs. 1 trillion. Also, this means that the allocated financial support for the Ministry of Energy will not exceed the aforementioned monetary limit.

The Energy Ministry will receive a subsidy of Rs. 980 billion in the upcoming budget. Additionally, this subsidy includes Rs. 262 billion for paying Independent Power Producers (IPPs) and an additional Rs. 298 billion for covering tariff differences and payments to K-Electric (KE).

Moreover, according to sources, the government will allocate Rs. 7 billion for players utilizing KE’s industrial support package. Although, the Ministry of Finance will grant Rs. 150 billion in tariff differentials to distribution companies (DISCOs), and an additional Rs. 80 billion will be provided as tariff subsidies for Azad Jammu and Kashmir.

According to reports, the ministry plans to allocate Rs. 10 billion to assist agri players in Balochistan. The funds will be used as a subsidy to support agriculture in the region, particularly for tube wells.

The upcoming budget for 2023-24 is anticipated to bring relief to the people in the former FATA region. Moreover, sources have revealed that Rs. 25 billion will be given as an electricity subsidy for the region. Additionally, Rs. 82 billion will be assigned to Power Holding Private Limited (PHPL) to ensure the company can meet its debt repayment obligations.

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