Govt raises gas prices by 10% for commercial users
Finance Minister Muhammad Aurangzeb chairs the Economic Coordination Committee meeting of the Cabinet on Friday, June 27, 2025. Photo: APP
In line with structural benchmarks set by the International Monetary Fund (IMF), the Economic Coordination Committee (ECC) of the Cabinet on Friday approved a new natural gas pricing framework, including an average 10 per cent tariff hike for bulk, industrial and power sector users.
Meanwhile, to shield domestic users from additional burden, the ECC decided to maintain existing gas prices for households while allowing an upward revision of fixed charges in the domestic sector to recover asset costs.
Chaired by Finance Minister Muhammad Aurangzeb, the ECC also approved a summary moved by the Petroleum Division for a revised pricing structure to take effect from July 1, 2025, under the fiscal year 2025–26.
Under the new framework, the government will notify revised consumer gas prices within 40 days of a determination by the Oil and Gas Regulatory Authority (OGRA), as required under the OGRA Ordinance.
Read More: OGRA greenlights hike in gas price
The pricing mechanism is aimed at ensuring cost recovery, regulatory compliance, and fulfilling IMF commitments, including rationalising captive power tariffs and replacing cross-subsidies with targeted support for low-income consumers.
In other decisions, the ECC gave in-principle approval to a risk coverage scheme for small farmers and underserved areas, set to launch on August 14. The scheme aims to bring 750,000 new borrowers into the formal financial system through agricultural loans of up to Rs750,000.
A total of Rs300 billion in new agricultural lending will be disbursed over the next three years. For risk coverage and administrative costs of banks, Rs37.5 billion will be required between FY2027 and FY2031.
Also Read: Double-digit fuel inflation looms
The ECC also approved a Rs15.839 billion technical supplementary grant (TSG) for the Ministry of Defence to meet a shortfall in employee and non-employee-related expenditures. The allocation covers dues under the Prime Minister's package for the families of martyrs from the recent Pakistan-India conflict.
Additionally, the committee considered a proposal from the Ministry of National Food Security and Research for the import of sugar to stabilise domestic prices.
The meeting was attended by Minister for Power Sardar Awais Leghari, Minister for Petroleum Ali Pervaiz Malik, and Special Assistant to the Prime Minister on Industries and Production Haroon Akhtar Khan, among other senior officials.
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