PRIME Minister Shehbaz Sharif’s newly announced Roshan Economy Power Package is being hailed as a ‘landmark’ step to boost industrial and agricultural productivity, enhance exports and create jobs. In practice, however, the initiative appears less a growth strategy and more an effort to push demand to increase utilisation of a power surplus of 7,000 MW “rather than letting it go to waste” as the energy minister himself admitted. This exposes the contradiction at the heart of the policy: the government is not rewarding efficiency or competitiveness but merely trying to stimulate electricity demand to utilise the excess capacity that taxpayers are already financing through the circular debt. Effective from next month, the three-year scheme offers industrial and agricultural consumers a discounted tariff of Rs22.98 per unit, but only for incremental electricity consumed by them above last year’s level. The package raises questions of equity and design as it primarily benefits industries and farmers capable of increasing their electricity consumption by 25pc, 50pc or even 100pc. Smaller industrial units and farmers unable to expand usage would gain nothing, even though they too bear the burden of a dysfunctional power sector.

That said, the package, however attractive, is unlikely to significantly raise overall demand. For industry, higher electricity use would require fresh investment in industrial capacity and new export orders to absorb additional output. In an inflation-hit and slowing economy with stagnating exports, few would commit new capital. Ultimately, the scheme may benefit only those who are relying on captive power but find the discounted tariff enticing enough to switch to the national grid. If the government genuinely wants productive sectors to boost their electricity usage and industry and agriculture to be more competitive, it must address the underlying structural problems that make power unaffordable: systemic inefficiencies, theft, an unreliable distribution network, poor governance and a distorted tariff structure that penalises honest consumers. Tariff discount packages designed to absorb surplus power cannot replace structural reforms. The negligible increase in industrial power demand under the same scheme last winter underscores the limited capacity of businesses to expand their electricity utilisation, reflecting structural and financial constraints in productive sectors. The package will perhaps generate a few months of goodwill. But industry and farmers do not need more gimmicks; they need courage, competence and a coherent energy sector reform plan to lower power costs.

Published in Dawn, October 27th, 2025