Pakistan’s government prepares gas market deregulation plan — The Express Tribune

Pakistan’s government is preparing to submit to the prime minister a roadmap for the phased deregulation of the gas sector. The plan was reviewed at a meeting chaired by Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb in Islamabad.

As The Express Tribune reports, the proposed model is intended to create a financially sustainable, efficient and competitive gas market. The Ministry of Finance said the reform should support businesses, encourage private investment and at the same time protect consumer interests.

Sector challenges

Meeting participants discussed accumulated circular debt, cross-subsidization, unaccounted-for gas losses and the imbalance between supply and demand. Particular attention was given to legacy financial obligations and improving the financial viability of gas companies.

The Ministry of Finance stressed that settling accumulated debt and defining an approach to cross-subsidies are important conditions for the viability of restructured enterprises. According to the ministry, these obligations had put pressure on both industry finances and public finances.

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Phased transition

The reform provides for a gradual transition to greater competition, with effective regulation, better operational performance and a more sustainable approach to gas pricing and supply. Expected outcomes include strengthening energy security, boosting private-sector investment, reducing fiscal and sovereign risks, developing company-to-company agreements and cutting system losses.

The authorities also expect more stable gas prices and improved access for exporters to gas at competitive prices. The model takes into account the experience of gas-sector reforms in Türkiye and the United Kingdom, adapting it to Pakistan’s institutional framework and market conditions.

After submitting the document to the prime minister, the government plans to continue technical work and consultations with stakeholders. Meeting participants stressed that changes must take place consistently, while maintaining supply reliability and protecting regulated consumers.