Govt urged to release Rs23 billion electricity subsidy for Karachi industries in FY26 budget

Delay in disbursing relief on incremental power consumption strains Karachi’s industrial sector

The Karachi Chamber of Commerce & Industry (KCCI) has called on Prime Minister Shehbaz Sharif to ensure the immediate release of Rs23 billion in pending electricity bill relief for incremental consumption by including a dedicated allocation in the upcoming federal budget for fiscal year 2025-26.

In a letter to the prime minister, KCCI President Muhammad Jawed Bilwani acknowledged government efforts to improve the economic environment but highlighted the prolonged delay in releasing the subsidy for electricity consumed between July 1, 2021, and October 21, 2023. 

He said this delay has placed significant financial pressure exclusively on Karachi’s industrial sector, while industries elsewhere in the country have already received similar support.

The total subsidy for the period amounts to Rs33 billion, with Rs23 billion undisputed and ready for disbursement. Although budget allocations were made over three fiscal years—Rs22 billion in FY 2021-22, Rs13 billion in FY 2022-23, and Rs7 billion in FY 2023-24—the funds have yet to reach the intended recipients due to procedural and legal hurdles involving K-Electric.

Bilwani criticised the lack of regulatory enforcement by the National Electric Power Regulatory Authority (Nepra), noting that K-Electric operated without a stay order for nearly nine months but still failed to pass on the subsidy to consumers. Despite a tribunal dismissing K-Electric’s appeals in July 2024, the issue remains unresolved following a stay order by the Islamabad High Court.

The KCCI urged the Power Division and Nepra to promptly verify the subsidy amount and ensure it is clearly reflected in the federal budget. It also proposed that the undisputed Rs23 billion be paid directly to industrial consumers, bypassing K-Electric, to prevent further delays.

Bilwani described the matter as not only a legal obligation but also an economic imperative. He stressed that releasing the subsidy is crucial to sustaining Karachi’s industries and maintaining the country’s economic stability. The chamber expressed hope that the prime minister would take swift action to resolve the issue and restore confidence among business stakeholders.

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