Islamabad: Pakistan has failed to meet the International Monetary Fund’s (IMF) deadline for issuing revised gas tariffs, resulting in a technical breach of a key structural benchmark under the country’s $7 billion Extended Fund Facility (EFF).
Under the agreement with the IMF, the government was required to notify updated semiannual gas tariffs by July 1, 2026, ensuring energy prices remain aligned with actual costs. The measure is one of 11 structural reforms agreed upon during the third review of the IMF program earlier this year.
Officials said the delay was caused by legal uncertainty surrounding the appointment of Nabeel Ahmad Awan as Acting Chairman of the Oil and Gas Regulatory Authority (OGRA), along with delays in finalizing revenue requirements for gas utilities amid fluctuating global energy prices.
According to government officials, OGRA has now completed the legal and procedural process for determining the revenue requirements of gas companies, including targets for reducing Unaccounted-for Gas (UFG) losses. However, the notification was delayed after the acting chairman requested station-specific UFG reduction plans instead of the broader annual targets previously followed by gas utilities.
The government is working to reduce gas sector losses by improving system monitoring, strengthening enforcement, and upgrading aging infrastructure. UFG losses have historically remained between 9% and 14%, despite repeated reduction commitments by gas distribution companies.
Officials described the missed deadline as a technical violation of the IMF benchmark and said the issue would be addressed through future revenue adjustments. Once OGRA issues its final determination, the government plans to notify revised consumer gas tariffs without waiting for the full 40-day period permitted under the law.
Pakistan has committed to maintaining cost-reflective energy tariffs under the IMF program to prevent further growth in the country’s Rs. 3.44 trillion gas sector circular debt. The government has also introduced a gas circular debt monitoring dashboard and plans to implement a new Circular Debt Management Plan during the current fiscal year to improve the sector’s financial sustainability.
