The National Energy Policy approved by the Council of Common Interests in its meeting on Wednesday promised the end of loadshedding by 2017, but was more of a tariff hike policy, as it authorized the raising of prices of not just electricity, but also CNG and gas. The policy, whose approval was held back for one meeting, while Sindh and KPK sought expert opinions, also envisaged the setting up of special courts to deal with gas and electricity theft. The hike in commercial, industrial and bulk tariffs is virtually immediate, but domestic consumers will only have theirs raised from October 1.

The policy also proposes the privatization of some government-owned power plants and distribution companies. However, the success or failure of the policy will depend on the government setting up new generation, including a ‘coal corridor’ of 6000-7000 MW, and hydel power is expected to add significant amounts every year. In the long term, there are three hydel projects, at Dasu, Pattan, and Thakot, making up the Indus Basin Cascade, with a proposed capacity of 7760 MW. This policy does not mention the 3800 MW that the Kalabagh Dam would generate. It is almost as if the present government, following the path of least resistance, was adopting as its own the statement by then Water and Power Minister Raja Pervez Ashraf in May 2008, that the Kalabagh Dam would not be built.

As was to be expected, the policy has attracted criticism, as it is going to prove inflationary. The hike in the domestic tariff will be paid by the man in the street, and he will also pay the hike in commercial and industrial tariffs, they being pass-through items which will merely be tacked on to the price. As most industry runs on electricity, the inflation will be widespread, affecting not only the price of food staples like flour, but also national exports. The resultant inflation is all the more painful because it was unveiled just as Eidul Fitr approached. What makes it more of a hardship is that is necessary to secure an IMF bailout, which will consider Pakistan’s request for a loan, and the policy, which should have provided relief to the ordinary citizen, is forcing more sacrifices on him.

The Energy Policy should be made more people-friendly, and must avoid the horrendous tariff rises, which came on the same day as the monthly fuel price increase, which made it obvious the kind of inflationary and unstable environment in which the policy was being approved. The government must provide relief on this front, not further suffering.