Pakistan mulls over 60 percent cut in solar buyback tariffs to save $15 billion in 10 years

Technicians walk between solar panels at the Interloop industrial park, in Faisalabad, Pakistan April 8, 2025. (Reuters)
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Updated 15 July 2025
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Pakistan mulls over 60 percent cut in solar buyback tariffs to save $15 billion in 10 years

  • Pakistan currently buys back solar-generated electricity from domestic, commercial and industrial producers at Rs27 per kilowatt hour
  • Authorities to present revised policy ‘within a month’ as global energy think-tank ranks solar as Pakistan’s largest power source in 2025

KARACHI: Pakistan’s government plans to more than halve the buyback tariffs for net-metered solar power to save Rs4.3 trillion ($15.1 billion) over the next ten years, according to people privy to the matter.

Authorities at Pakistan’s energy ministry are working on a new solar policy that looks to change the current net-metering regime under which the cash-strapped government is buying back solar-generated electricity from domestic, commercial and industrial producers at Rs27 per kilowatt hour (kWh).

The buyback rates for large scale grid-connected solar plants like Quaid-e-Azam Solar Power (Pvt.) Limited, Pakistan’s first 100-megawatt solar utility set up by Punjab government, ranges between Rs9 and Rs11.

“The government is proposing to remove this anomaly and offer almost a uniform buyback rate for net-metered solar power in line with global standard practice,” said a Pakistani energy ministry official who is privy to the policymaking discussions but cannot share them with media.

He said officials at the ministry’s power division will present a revised solar policy to the federal cabinet “within a month,” proposing to reduce the buyback price for net-metered solar power by more than 60 percent to Rs10 per kWh.

The government plans to link the buyback rates with the national base tariff.

“The government is encouraging these domestic and other distributed solar producers and has allocated a quantum for them in the IGCEP (Indicative Generation Capacity Expansion Plan),” the official said.

“What this new net-metering policy will define is the question that at what rate the government should buy power from these distributed producers. We are working this out.”

The move would help the government save Rs4.3 trillion ($15.1 billion) in the decade to come, he added.

Prime Minister Shehbaz Sharif’s government is currently trying to revive Pakistan’s debt-ridden economy by introducing energy and economic reforms, backed by the International Monetary Fund (IMF) that approved a $7 billion loan for the South Asian nation in Sept., last year.

Promoting renewable energy sources like solar and wind has been part of the government’s plan to avoid costly oil imports that shrank five percent to $15 billion from July 2024 till May 2025, according to latest official figures.

The South Asian country has boosted solar electricity generation by over three times the global average so far this year, fueled by a more than fivefold rise in solar capacity imports since 2022, Reuters reported last month, citing data from global energy think tank Ember.

The combination of rapidly rising capacity and generation has propelled solar power from Pakistan’s fifth-largest electricity source in 2023 to its largest in 2025, Reuters said.

However, the country still relies heavily on fossil fuels and generates 56 percent electricity from thermal, 24.4 percent from hydel, 8 percent from nuclear and 12.2 percent from renewable energy sources.

According to Pakistan’s latest economic survey, the nation’s total installed electricity generation capacity stood at 46,605 megawatts from July 2024 till March 2025, showing 2 percent increase from 45,888 megawatts during the same period in the previous year.

“The increase can be attributed with the installed capacity of 2,813 MW from net-metering,” the survey said.

Shankar Talreja, head of research at Karachi-based brokerage firm Topline Securities, said Pakistan had been spending billions of dollars on the import of solar panels from China, thus pushing the country’s inflation-hit consumers from grid-based energy to solar photovoltaic plants many of them have now installed at their rooftops to ensure smooth and cheaper supply of electricity.

“The benefit of net-metering was quite attractive, [so] people started installing solar at their rooftops and they were also selling excess electricity to government at a price of over Rs20 per kwh,” Talreja said.

“Pakistan imports over $2 billion of solar [panels] every year and it was increasing at a higher rate, resulting in further reduction in utilization of grid energy.”

Pakistan has so far imported solar panels of 48,000 megawatts capacity, mostly from China, of which, the country is generating close to 6,000 megawatts power due to low efficiency (up to 21 percent) of these panels, according to officials.

“People are installing as many solar plants as possible and selling their surplus power to the government at a higher rate,” the energy ministry official said, adding the government is also considering 8,500 megawatts power generation quota for the distributed net-metering solar electricity that comes from domestic, agriculture, commercial and industrial producers.

“The buyback rate the power division is proposing stands equivalent to the tariff we are using to buy power from large-scale solar plants,” he said, adding that even K-Electric, Pakistan’s largest private utility that powers the country’s commercial capital of Karachi, had agreed to sell its solar power to the government at as much as Rs10 per kilowatt.

Last month, K-Electric signed a memorandum of understanding (MoU) with China’s Huawei Digital Power Pakistan to strategically collaborate for 300 MWh battery energy storage systems and electric vehicles charging infrastructure to accelerate Pakistan’s smart energy transition.

The off-grid solar solution was one of the major reasons for 4 percent decrease in Pakistan’s total electricity consumption that dropped to 80,111 gigawatt hours from July 2024 till March 2025, according to the economic survey.

Talreja said the government, sensing the costly nature of net-metering, has started discouraging and insisting people to stay on the national grid, and proposed to slash and link the buyback tariff with national base tariff, i.e. 33 percent.

“The government is trying its best to increase share of renewables in overall energy mix, however, its implementation gets tougher due to idle capacity of expensive thermal assets,” the economist said.


Pakistan confers award on CENTCOM chief for promoting Islamabad-Washington military ties

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Pakistan confers award on CENTCOM chief for promoting Islamabad-Washington military ties

  • President Asif Ali Zardari confers Nishan-e-Imtiaz (Military) award on General Michael E. Kurilla 
  • Pakistan credits General Kurilla for deepening counterterrorism cooperation between two countries 

ISLAMABAD: President Asif Ali Zardari this week conferred the Nishan-e-Imtiaz (Military) award on United States Central Command (CENTCOM) chief General Michael E. Kurilla for promoting military cooperation between the two states, state-run media said. 

Kurilla arrived in Pakistan to attend a rare regional defense conference on Saturday in which officials from Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan also took part.

Zardari conferred the award on General Kurilla during a formal investiture ceremony in Islamabad on Saturday, state broadcaster Radio Pakistan reported, acknowledging his “outstanding contributions” to regional security and his dedicated efforts in strengthening strategic defense ties between the two countries.

“The award has been given in recognition of his exemplary service and pivotal role in advancing enduring military cooperation between Pakistan and the US,” Radio Pakistan said. 

The state media credited Kurilla’s leadership for fostering mutual understanding, enhancing defense collaboration and deepening counterterrorism cooperation between Pakistan’s armed forces and CENTCOM.

Radio Pakistan said during his visit, Kurilla held detailed meetings with senior Pakistani civil and military leadership,which included Zardari and Field Marshal Syed Asim Munir.

“Discussions encompassed regional security, military-to-military engagement, and joint efforts to combat terrorism and emerging transnational threats,” the statement said. 

Pakistan has recently sought a diplomatic reset with Washington after years of estrangement between the two countries, particularly during the Afghan war, where diverging perspectives deepened mistrust.

High-level bilateral exchanges gradually faded as the US withdrew from Afghanistan. However, Islamabad has undertaken efforts in recent months to grow closer to the US administration, with Pakistan even nominating President Donald Trump for a Nobel Peace Prize for brokering a ceasefire between Islamabad and New Delhi on May 10. 


Monsoon floods hitting key crops, says farmers’ body, amid risk to Pakistan’s growth target

Updated 18 min 41 sec ago
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Monsoon floods hitting key crops, says farmers’ body, amid risk to Pakistan’s growth target

  • Cotton arrivals fall 33 percent as rains hit production, according to the country’s ginners’ association
  • Pakistan’s Met department forecasts more monsoon rains in Punjab and Khyber Pakhtunkhwa

KARACHI: Deadly monsoon floods are devastating Pakistan’s standing crops, with cotton the worst hit, a leading farmers’ representative warned on Saturday, raising concerns about a potential setback to the government’s ambitious 4.2 percent growth target this fiscal year.

Over 270 people, mostly children, have died and hundreds more have been injured since June 26 as intense monsoon rains battered Punjab, Khyber Pakhtunkhwa (KP), Sindh, Balochistan, Azad Kashmir, Gilgit-Baltistan and Islamabad, according to the National Disaster Management Authority (NDMA).

Around 1,200 houses, 12 bridges and 18 kilometers of road have also been damaged, along with more than 360 livestock killed.

“Cotton is the worst-hit crop, besides rice, maize and mango orchards,” Khalid Mehmood Khokhar, president of the Kissan Ittehad Council (KIC), told Arab News. “While most of the rice has already been sown, floods have disrupted the remaining cultivation.”

Agriculture contributes nearly 23 percent to Pakistan’s GDP and underpins key export sectors. Cotton, in particular, is a vital raw material for Pakistan’s textiles, which fetched $18 billion in exports last fiscal year. Pakistan also exported $3.4 billion worth of rice and $308 million in fruits, including mangoes.

The government aims to produce 10.1 million bales of cotton across Punjab, Sindh, KP and Balochistan in the ongoing financial year. But progress has been uneven.

In Sindh, the biggest cotton-producing province, only 65 percent of the sowing target has been met. Punjab, the second-largest grower, has achieved 90 percent of its target.

Pakistan’s agriculture sector grew just 0.6 percent during the last fiscal year, dragging overall GDP growth down to 2.7 percent.

Economists warn the impact of the floods could again weigh heavily on national output.

“These floods will definitely impact Pakistan’s growth target this year,” Sana Tawfik, head of research at Arif Habib Limited, said. “This is a serious concern.”

She projects GDP growth to be closer to 3.4 percent this year.

“Agriculture may once again be a major drag,” she added.

Khalid Abdullah, Pakistan’s former cotton commissioner, said rainfall was already affecting crop quality.

“Rains and cloudy weather have been consistent in some areas,” he said. “This not only increases weeds but also flares up fungus attacks. If this weather continues, the cotton seed may start germinating inside the boll, which would mean the crop is gone.”

As of July 15, cotton arrivals were down 33 percent year-on-year, according to Pakistan Cotton Ginners’ Association data, with only 297,751 bales entering markets nationwide.

The government has still not shared estimated economic damages from the ongoing monsoon season, though they may run into billions of dollars once again.

Pakistan is one of the world’s most climate-vulnerable countries. According to the Economic Survey 2024–25, it has suffered 224 extreme natural disasters, 109 of them floods, since 1980, in which more than 100 million people were affected, causing $36.4 billion in economic losses.

Three years ago, Pakistan experienced heavy monsoon rains that killed about 1,700 people and caused widespread destruction of houses, farms and public infrastructure.

The Pakistan Meteorological Department has forecast further rainfall in parts of Punjab and KP over the coming days, as the monsoon season continues in the country.


Glacial floods alert issued for northwest Pakistan with more heavy rain forecast

Updated 26 July 2025
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Glacial floods alert issued for northwest Pakistan with more heavy rain forecast

  • Pakistan is seeing above-normal monsoon rains, raising fears of a repeat of the 2022 floods
  • Despite low emissions, the country remains among the most climate-vulnerable nations

PESHAWAR: Pakistan on Saturday warned of glacial flooding in the northwest with more rain forecast for the area in the coming week.

Downpours are heavier in Khyber Pakhtunkhwa province than the same period last year, prompting weather adviseries and alerts for flooding from glacial lake outbursts, said Anwar Shahzad, a spokesperson for the local disaster management authority.

A letter from the authority sent out mid-July said “persistent high temperatures may accelerate snow and glacier melt and subsequent weather events” in vulnerable parts of the region.

Dr. Abdul Samad, from the Khyber Pakhtunkhwa Tourism Department, said rescue teams evacuated more than 500 holidaymakers from Naran after a cloudburst overnight Friday caused a road closure. Authorities deployed heavy machinery to remove debris and restore access.

In the neighboring Gilgit-Baltistan region, the government said it had distributed hundreds of tents, thousands of food packets, and medicine to flood-affected communities.

Spokesperson Faizullah Firaq said Saturday there was “severe destruction” in some areas and damage to houses, infrastructure, crops, and businesses.

Search operations were underway to find missing people on the Babusar Highway, where flooding struck nine villages. Helicopters rescued tourists stuck in the popular spot of Fairy Meadows, he added.

Pakistan has received above-normal rainfall this monsoon season, raising concerns of a repeat of the devastating 2022 floods that submerged a third of the country and killed 1,737 people. Some 260 have died across Pakistan so far this season, which runs through to mid-September.

Pakistan is one of the countries most vulnerable to climate change, but one of the lowest contributors to greenhouse gas emissions.


Pakistan PM pledges sustained diplomatic push to end Gaza aid blockade

Updated 26 July 2025
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Pakistan PM pledges sustained diplomatic push to end Gaza aid blockade

  • Israel’s blockade has drastically restricted access of food, water and medical supplies
  • UN, aid groups warn of mass starvation and malnutrition, especially among children

ISLAMABAD: Prime Minister Shehbaz Sharif on Saturday vowed to continue diplomatic efforts to challenge Israel’s aid and humanitarian blockade in Gaza, as he spoke by phone with Hafiz Naeem-ur-Rehman, leader of the Jamaat-e-Islami (JI) party, which has been actively supporting deliveries of basic necessities to Palestinians.

In recent weeks, Gaza has faced a worsening humanitarian crisis, as Israel’s blockade, imposed since the beginning of March, has drastically restricted access of food, water and medical supplies.

The United Nations and aid groups have warned of mass starvation and malnutrition, especially among children, with only a few aid trucks allowed to enter Gaza, which is home to about two million inhabitants.

“Pakistan will continue vigorous diplomatic efforts to end Israel’s suspension of aid to Gaza and restore delivery of food and essential supplies to starving Palestinian brothers and sisters,” Sharif said, as per a statement shared by his office.

He also reaffirmed Pakistan’s moral and diplomatic support for the people of Palestine, commending JI and its charitable arm, Al-Khidmat Foundation, for their domestic campaigns to raise and send relief aid to Gaza.

The JI chief urged Sharif to lobby the international community to help facilitate a ceasefire and humanitarian corridor into Gaza, saying that Palestinians and the entire Muslim world look to Pakistan for leadership.


US, Central Asian defense chiefs join Pakistan for rare regional security talks in Islamabad

Updated 26 July 2025
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US, Central Asian defense chiefs join Pakistan for rare regional security talks in Islamabad

  • Pakistan’s army chief calls for military-to-military cooperation, strategic dialogue amid hybrid and transnational threats
  • The participants expressed commitment to upholding peace and confronting challenges like militancy, cyber insecurity

ISLAMABAD: Pakistan hosted a rare regional defense conference on Saturday, with officials from the United States joining their counterparts from four Central Asian republics to discuss enhanced military cooperation and counterterrorism coordination in the neighborhood.

The US maintained a significant military presence in the region through Afghanistan until the withdrawal of international forces in August 2021. The conference in Islamabad marked the first multilateral defense engagement of its kind hosted by Pakistan amid a gradual thaw in relations between Islamabad and Washington, with participation from Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan.

Many of the participating Central Asian states share borders with or lie close to Afghanistan and remain exposed to the spillover effects of militant violence, narcotics trafficking and regional instability.

Pakistan, which shares a porous frontier with Afghanistan, has repeatedly called for deeper security cooperation to confront shared threats in the aftermath of the Afghan conflict.

“In an era defined by transnational threats and complex hybrid challenges, the imperative for deeper military-to-military cooperation, strategic dialogue and mutual trust is paramount,” Pakistan’s Chief of Army Staff Field Marshal Syed Asim Munir said during his opening address, according to a statement released by the military’s media wing.

“Pakistan remains fully committed to working with partner nations to build a secure and prosperous regional environment,” he added.

Earlier, the army chief welcomed the participants of the Regional Chiefs of Defense Staff Conference, held under the theme “Strengthening Bonds, Securing Peace.”

The event focused on strengthening regional security partnerships, expanding joint training efforts and improving crisis response mechanisms.

Delegates also discussed the strategic landscape in South and Central Asia, with emphasis on evolving threats, sovereignty concerns and military diplomacy.

The official statement said the participants reaffirmed their commitment to upholding peace, respecting national sovereignty and confronting common challenges including militant violence and cyber insecurity.

Delegates praised Pakistan’s role in convening the meeting and commended its leadership, hospitality and efforts to promote regional defense diplomacy.