The Pakistani export market received a devastating setback because the government implemented a gas price surge for industrial self-generating power which created uncompetitive export prices thus threatening the $60 billion export goal until 2027. A letter from the Pakistan Business Council (PBC) delivered to Prime Minister Shehbaz Sharif presented evidence indicating economic disaster for the country.
The International Monetary Fund (IMF) imposed gas price hike on Karachi as one of the conditions for taking loans which raised expenses for enterprises using captive power plants (CPPs). The Economic Coordination Committee (ECC) approved an 18% gas price increase while implementing proposed vertical levies worth 20% which will start this August 2025. Gas prices are expected to reach $15 for each mmBtu afterward while surpassing Bangladesh gas tariffs along with worldwide LNG market values.
The PBC points out that manufacturing contributes substantially to export volumes through gas-powered CPP facilities yet reports manufacturing as the least attractive industry for investment because exports represent 50% of present-day Pakistan exports. The industrial electricity rate stands at 17 cents per unit which places Pakistan as highest in the region and worsens the existing crisis. 
The Finance Minister Muhammad Aurangzeb supported this decision based on reaching 1,100 industrial CPP users from the existing 5,600 gas link customers. According to the PBC the recent increase in gas prices could eliminate any positive effects U.S. tariffs on Chinese imports had on the economy because India and Vietnam acquired advantages as a result.
The projected growth of Pakistan’s exports to $35 billion this year faces the risk of failure because of rising gas costs which also puts the nation’s export plans in danger and extends the debt cycle period.
