PAKISTAN PROTESTS
WHY IN NEWS ?
- Several cities in Pakistan have recently witnessed protests over high electricity bills. Peshawar, Karachi, Lahore, Multan, Rawalpindi, have all seen people blocking roads, burning tyres and chanting slogans against the hiked electricity charges.
ABOUT ELECTRICITY PROTESTS:
- The protesters have refused to pay the exorbitant electricity bills for July.
- According to them, they were already struggling amid high inflation and high unemployment, and experiencing high load-shedding to boot.
- The massive bills will deal a crippling blow to many businesses, trade unions have said.
- According to the Pakistani news agency Dawn, average electricity cost has “more than doubled for low- to middle-class households since May”.
CAUSES OF HIGH ELECTRICITY TARIFFS:
- The hike has mainly to do with the conditions Pakistan agreed to for a $3-billion bailout by the International Monetary Fund (IMF) in June.
- Under a host of regimes to boost fiscal discipline, the IMF has asked Pakistan to shore up tax revenue.
- The bailout deal could be signed only after eight months of tough negotiations.
- The anticipated improvement in tax revenues is critical to strengthen public finances, and to eventually create the fiscal space needed to bolster social and development spending.
- In parallel, the authorities urgently need to strengthen energy sector viability by aligning tariffs with costs, reforming the sectors cost base, and better-targeting power subsidies.
- Thus, in July, power tariff was hiked at different rates for different categories of customers.
SYLLABUS: PRELIMS, CURRENT AFAIRS
