The International Monetary Fund (IMF) has turned down a key proposal from Pakistan’s Ministry of Energy, dealing a setback to the country’s ambitions to accelerate growth in the artificial intelligence (AI), data mining, and industrial sectors.
The proposal, known as the “marginal energy package,” was designed to utilize Pakistan’s surplus electricity—estimated at 8,000 megawatts—by offering it at a reduced cost to selected high-potential sectors.
The three-year package aimed to stimulate Pakistan’s digital and industrial economies by providing cheaper electricity, with the intention of enhancing the country’s regional competitiveness, especially in emerging fields like AI and data processing.
According to the plan, electricity consumers in these sectors would only pay the base production cost and capacity charges, with all additional taxes and surcharges being waived. The initiative was seen as a strategic move to attract tech investment, promote innovation, and boost industrial output without burdening the grid.
However, despite multiple rounds of discussions, senior officials at the Ministry of Energy were unable to secure IMF approval for the plan. The global lender has conditioned its approval on ensuring 100 percent recovery of all outstanding electricity dues—a target the ministry has not yet been able to meet. As a result, the implementation of the energy package has been stalled, putting the future of this development initiative in limbo.
Government insiders have confirmed that the proposal will likely be revisited in the next round of economic review talks with the IMF, where officials hope to renegotiate terms that could revive the initiative.
For now, Pakistan’s surplus electricity remains underutilized, and hopes of using it to power a new era of AI-driven and industrial growth have been put on hold. The IMF’s rejection underscores the challenges Islamabad faces in aligning its economic development plans with strict financial reforms and accountability measures required under the ongoing loan program.
