Prime Minister Shehbaz Sharif unveiled on Tuesday a comprehensive plan to overhaul Pakistan’s electricity distribution system, citing longstanding inefficiencies and corruption as primary reasons for the sector’s struggles.
During a recent meeting with the chairman and board members of various electricity distribution companies (DISCOs), the Prime Minister emphasized the dire need for reform, stating that the existing system has “hollowed out the roots of Pakistan.”
The Prime Minister's remarks come in response to persistent issues within the DISCOs, including poor performance attributed to mismanagement and corruption. Sharif expressed frustration over the inefficacy of these companies, highlighting that their performance has been far from satisfactory. “Our performance regarding DISCOs has not been appreciable,” he stated, underscoring the urgent need for systemic changes.
In an effort to address these problems, the government plans to privatise and overhaul DISCOs facing severe challenges. This step is expected to stabilise the economy by improving the electricity system. However, the process of appointing capable individuals to manage these companies has been hindered by legal complications, leading to significant delays.
PM Sharif revealed alarming statistics about electricity theft, estimating that approximately 500 billion rupees worth of electricity is stolen annually through collusion.
He noted that, despite having competent officers within DISCOs, efforts to prevent theft and manipulation have been insufficient. The Prime Minister stressed the necessity of reforming the system to halt such practices and improve overall efficiency.
The electricity sector is currently burdened with a revolving debt of 2,300 billion rupees, a staggering amount compared to the 9,000 billion rupees in revenue. This debt represents a quarter of the sector’s total revenue, raising concerns about the sustainability of the current system. Weak transmission infrastructure and high line losses are among the factors contributing to this financial strain.
In response to the poor performance of independent directors at DISCOs, the federal government has decided to replace them. Prime Minister Sharif has directed that a summary for the appointment of new board members for nine out of eleven government electricity distribution companies be presented to the Federal Cabinet.
Subsequently, a summary for the appointment of new Board of Directors for eight DISCOs, including Islamabad Electric Supply Company (IESCO), Faisalabad Electric Supply Company (FESCO), Tribal Area Electric Supply Company (TESCO), and Quetta Electric Supply Company (QESCO), has been submitted for cabinet approval.
The Prime Minister’s initiative reflects a decisive move towards rectifying the systemic issues plaguing Pakistan’s electricity distribution sector, with the ultimate goal of restoring efficiency and stability to a critical component of the nation’s infrastructure.
