Islamabad, Jan 15: In a significant move to alleviate electricity costs and bolster national savings, the federal cabinet, chaired by Prime Minister Muhammad Shehbaz Sharif, approved revised IPP agreements with 14 Independent Power Producers (IPPs). These renegotiated settlements are expected to save Rs. 1.4 trillion over their term, with annual savings projected at Rs. 137 billion.
The IPP agreements include a reduction of Rs. 802 billion in costs and profits of the IPPs, alongside the recovery of Rs. 35 billion in excess profits from prior years.
Of the 14 IPPs, 10 were established under the 2002 Power Policy, while four operated under the 1994 Power Policy. The cabinet also canceled an agreement with one IPP from the 1994 policy.
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The prime minister lauded this milestone, emphasizing its role in reducing circular debt and stabilizing electricity prices, which will benefit consumers nationwide. He praised the efforts of the Power Minister, Task Force members, and relevant officials for their contribution to this achievement.
The cabinet also approved the integration of several ministries to reduce administrative costs and enhance efficiency. The Ministry of Narcotics Control will merge with the Ministry of Interior, functioning as a wing under the latter. This restructuring will save Rs. 183.25 million annually in administrative expenses.
Similarly, the Aviation Division will be re-integrated into the Ministry of Defence, a role it held before 2013. This merger is expected to save Rs. 145 million annually while improving airspace management.
Additional decisions included the approval of a new Section 45-A in the Public Procurement Rules, 2004, allowing procuring agencies to delegate procurement responsibilities. The cabinet also endorsed the National Commission for Minorities Act 2024 for parliamentary approval.
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Furthermore, the employment contract of Dr. Muhammad Bashir, Technical Member of the Environmental Tribunal in Islamabad, was extended for two years to ensure the continuation of his contributions to environmental justice.
These transformative measures reflect the government’s commitment to financial discipline, operational efficiency, and public welfare. The approved policies mark a crucial step towards a sustainable and economically stable future.
