Amid financial turmoil and power outage, Pakistan Prime Minister Shehbaz Sharif has called a meeting of the federal cabinet on Tuesday, in which some important decisions are expected to be taken, according to local sources.
Monday’s blackout hit schools, factories and shops, and many people in the country of about 220 million were without drinking water because even electric pumps were not working. At major businesses and institutions, including major hospitals, military and government facilities, backup generators kicked in.
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Pakistan will get the International Monetary Fund’s (IMF) bailout of $6 billion next week, according to the finance ministry, but there is no confirmation yet, sources said. The country’s central bank State Bank of Pakistan (SBP) has increased the policy rate to 17%.
Meanwhile, Pakistan is set to repay a $500 million loan to a Chinese commercial bank – the second in the past seven days – which could push reserves below $4 billion without any fresh injections.
On behalf of my Government, I would like to express our regret for the inconvenience caused to our citizens due to the power cut yesterday. An investigation is underway to find out the cause of the power failure on my orders. Responsibility will be fixed.- Shehbaz Sharif (@CMShehbaz) January 24, 2023
numberspeak
The All Pakistan Textile Mills Association reported a loss of Rs 16.1 billion on Tuesday due to power cuts. Power outages are frequent due to lack of funds to upgrade its aging infrastructure.
As per reports, goods worth about $4 billion are stuck at various ports in Pakistan awaiting approval of letters of credit (LC). Goods imports declined to $4.2 billion in Dec-22. That number used to be north of $6 billion before the compression.
Production of goods has come to a standstill in an estimated 30% of factories. Local reports say that Pakistan’s weekly inflation has reached 32%.
The Pakistani rupee continues to weaken against the US dollar as the interbank dollar rate rises to 231.
The current account deficit stood at $400 million on December 22 and $1.2 billion in the second quarter.
The IMF released the last significant tranche of $1.1 billion to Islamabad in August, but since then, Pakistan’s reluctance to implement the new tax measures has led to a lull in discussions between the two sides.
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power outage
Pakistan’s energy minister on Tuesday defended the government after a major, day-long power cut that disrupted normal life across the country and criticized the millions of people who remain without power amid harsh winter weather. Had gone. Power was mostly restored, although some parts of the country continued to experience power outages on Tuesday.
In accordance with a government energy-saving scheme, authorities had switched off the power during low-use hours on Sunday night to save fuel. Attempts to turn power back on Monday morning caused a systemwide meltdown.
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Energy Minister Khurram Dastgir expressed no regret for the grid collapse, but praised the efforts of the country’s engineers and technicians to boot up the system. He also made no reference to the fact that energy-saving measures by the government have backfired.
Dastgir made a “remote possibility” that the outage was caused by hackers targeting the Pakistani grid’s systems and expressed confidence that a three-member committee set up by Prime Minister Shahbaz Sharif on Monday would get to the bottom of it.
help from america
A top Biden administration official said that the US is ready to help Pakistan solve its power crisis. “Of course, (we) have seen what has happened in Pakistan. Our thoughts are with all those affected by the outage. As you mentioned, certainly the US has helped our Pakistani allies in whatever challenges they may have.
in 2021
The outage was reminiscent of a massive blackout in January 2021, which at the time was attributed to a technical fault in Pakistan’s electricity generation and distribution system. Pakistan receives at least 60% of its electricity from fossil fuels, while about 27% is generated from hydroelectricity. Nuclear and solar power contribute about 10% to the country’s grid.
Fawad Chaudhry, a senior leader of the opposition Pakistan Tehreek-e-Insaf party, on Monday criticized the government for mismanagement of the country’s economy and said the outage was a reflection of the government’s inefficiency.
with PTI inputs
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