Pakistan government eyes single gas price, targeted subsidies in reform push

Malik created the remarks during a gathering in Karachi with the chairman, board of directors, managing director and senior management of Sui Southern Gas Firm Limited to review performance, operational challenges and reform priorities.

Key points

• While pursuing reforms to ensure the company's long-term sustainability, "Public service must remain the top priority in all operational, financial and strategic decisions, " Malik remarked.
• "The existing system of gas subsidies via pricing slabs needs to be revisited, " Malik remarked.
• While domestic consumers receive gas three times daily, authorities informed the session there is no gas load-shedding for K-Electric, industrial consumers and fertilizer plants.
• Malik directed that gas supply problems in Balochistan be prioritized, alongside addressing technical challenges, infrastructure constraints and gas theft, stressing sustainable solutions to improve availability and service delivery.

"The existing system of gas subsidies via pricing slabs needs to be revisited, " Malik remarked. He emphasized transitioning to a single fair cost for all consumers, with vulnerable segments shielded through social protection programs, adding that the move would spur economic activity and curb customer migration to alternative fuels.

Malik directed the SSGCL board to develop a comprehensive strategy and sustainable business model with a focus on unaccounted-for gas control to transform the firm into a financially viable organization while keeping public service as the foremost priority.

SSGCL Managing Director briefed the minister on the company's milestones and challenges, reporting a significant improvement in the distribution system with UFG reduced by approximately 57% in volumetric terms.

According to Malik, gas costs have not rose over the past year and that the rise in gas circular debt has almost been halted, marking progress toward sector stabilization.

Meanwhile, the minister remarked the administration is working with the World Bank on comprehensive gas sector reforms aimed at addressing structural challenges and creating a more efficient, sustainable and financially viable sector.

Discussing Balochistan, the SSGCL board welcomed the formation of a political committee under the deputy prime minister to examine the province's challenges, calling it a positive step toward resolving longstanding problems.

Taken together, the developments around pakistan government eyes single gas price, targeted subsidies in reform push point to a situation that is still moving, and the coming days should bring more clarity.