ISLAMABAD – Authorities in Pakistan are preparing to phase out long-standing electricity subsidy for consumers using up to 200 units per month, as part of a sweeping move toward a targeted welfare system, sources in the Ministry of Finance said.
The blanket subsidy on electricity is expected to be completely withdrawn, in what will be end of broad-based relief for domestic consumers. In its place, a new “targeted subsidy framework” is set to be launched from January 1, 2027, under which only genuinely low-income and eligible households will receive financial assistance.
The decision is being taken in line with International Monetary Fund (IMF) conditions, which call for the elimination of universal subsidies and their replacement with more focused support for vulnerable segments of society, officials said.
Under proposed system, subsidies on electricity, gas, and essential commodities such as flour will no longer be available to the general public. Instead, assistance will be restricted to individuals earning between Rs20,000 and Rs30,000 per month, significantly narrowing the scope of government relief.
To enforce strict eligibility checks, authorities are planning digital verification system that links consumer electricity data with the National Database and Registration Authority (NADRA). In addition, a mandatory QR code-based system is expected to be introduced to verify income and eligibility status at the point of access.
Officials further disclosed that only those registered under the Benazir Income Support Programme (BISP), or individuals who meet stringent poverty assessment criteria, will qualify for electricity relief under the new regime once it is implemented.
The proposed overhaul signals one of the most significant changes in Pakistan’s subsidy structure in recent years, potentially reshaping how millions of households receive support for basic utilities.
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