The Energy Crisis in Pakistan: Ramifications, Culprits, and Solutions

The Energy Crisis in Pakistan Ramifications, Culprits, and Solutions

The following article, “The Energy Crisis in Pakistan: Ramifications, Culprits, and Solutions“, is written by Areeba Fatima, a student of Sir Syed Kazim Ali. Moreover, the article is written on the same pattern, taught by Sir to his students, scoring the highest marks in compulsory subjects for years. Sir Kazim has uploaded his students’ solved past paper questions so other thousands of aspirants can understand how to crack a topic or question, how to write relevantly, what coherence is, and how to include and connect ideas, opinions, and suggestions to score the maximum.

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1- Introduction

  • ✓Overshadowing all other domestic evils Pakistan faces today, the predominant energy crisis has become a daunting reality for the country, resulting from the unproductive role of the government and media and hampering the country’s socioeconomic and political development. Nonetheless, the government’s and the media’s vibrant role in energy-related policy implementation and raising public awareness can strengthen the country’s social and economic fabric against rampant energy insecurity. 

2- Current outlook of the energy crisis in Pakistan

  • ✓Currently, Pakistan is experiencing a severe energy crisis due to its reliance on imported fossil fuels and infrastructural bottlenecks.
    • Evidence: According to the Pakistan Economic Survey (FY-21), the country’s electricity demand has surged to 28,200 megawatts while the power shortfall has surged to over 7,000 megawatts.

3- How has the energy crisis hampered the country’s socioeconomic progress?

  • Reduction in industrial and agricultural output
    • The consequences of the persistent load shedding on industrial and agricultural productivity have become an appalling challenge for Pakistan.
    • Evidence: According to the Ministry of Power, load shedding has reached 10-12 hours in the country due to the non-availability of natural gas.
  • Shrinkage of forex reserves
    • The power shortage puts a mammoth burden on the country’s already dwindling forex reserves in the presence of a trade imbalance.
    • Evidence: According to the All Pakistan Textile Mills Association (APTMA),1,600 textile mills have been closed owing to the power shortage.
  • Escalating poverty
    • The energy crisis proved to be a catalyst to elevate poverty in the state.
    • Evidence: According to the National Bureau of Economic Research (NBER), theunemployment rate is a significant determinant of poverty as per the research from an American nonprofit organization.
  • Threat to national autonomy
    • Energy scarcity has become an existential threat to the state’s security due to the rising public and government gap.
    • Evidence: Winston Churchill beautifully explains the importance of fuel energy for citizens: “Above all, petrol governs every movement.”

4- Why does the country bear the brunt of the energy crisis?

  • Lack of consensus among the country’s stakeholders in policy making
    • An incompetent government has raised the miseries on the already crippling state’s foundation.
    • Evidence: According to the Pakistan Economic Survey (2021-2022), liquefied natural gas increased by 82.90 per cent in value, while liquefied petroleum gas (LPG) imports also jumped by 39.86 per cent.
  • Fuel scarcity
    • The energy crisis in Pakistan mounted toward its peak, which was an indication of fuel shortage.
    • Evidence: According to the Oil Companies Advisory Council (OCAC), fuel shortages were experienced in some regions of the country as some oil companies experienced higher-than-expected sales while imports were limited.
  • Energy transmission and distribution losses
    • Pakistan teetered at the brink of the energy crisis due to energy transmission and distribution losses.
    • Evidence: According to the Pakistan Economic Survey (FY-21), the country’s public sector distribution companies (DISCOs) lost more than 2.8 billion rupees due to the short recovery of bills in more than 430,000 cases of electricity theft.
  • Use of conventional technological tools
    • The use of old technology is the root of the power losses in Pakistan, from energy production to distribution.
    • Evidence: According to the Central Power Purchasing Authority (CPPA), circular debt stood at 2467 billion Pakistani Rupees by March 2022.
  • Apathetic role of media
    • The power shortage in Pakistan is an alarming result of the incompetent role of the media in bringing awareness to the public regarding energy consumption.
    • Evidence: According to Lumen Learning, media concentration on a few problems makes the public perceive those issues as more important than others.

5- How can Pakistan’s government buckle down the nightmare of the energy crisis in the country?

  • ✓ To develop harmony among the inter-provincial-federal governments on the energy issue
  • ✓ To adopt alternative low-cost and self-reliant energy resources
  • ✓ To improve the efficiency of energy distribution companies
  • ✓ To utilize the advanced technology in the power sector
  • ✓ To initiate the media’s awareness campaigns on energy consumption

6- Critical analysis
7- Conclusion

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Answer to the Question

As a powerful engine, the energy sector is crucial for a state to achieve peace and prosperity in the rapidly evolving era of urbanisation and industrialisation. It undeniably has the potential to overcome the state’s fundamental socioeconomic problems and influence its foreign policy. Therefore, the International Atomic Energy Agency (IAEA) claims that an uninterrupted energy supply is essential for the security and sovereignty of a state. Notwithstanding, the ongoing global energy crisis has left several countries, especially the energy-importing countries, scrambling for fuel due to the leading constraints of COVID-19 and the Russia-Ukraine war. Similarly, having heavily relied on foreign energy supplies, Pakistan’s energy industry is also in a crisis. To confirm the country’s malfunctioning, K-Electric’s spokesperson Imran Rana said that Karachi has experienced an average shortfall of 450-500 Megawatts of power in 2022. Consequently, the power shortage has prevented the country from sustaining its socioeconomic development and strengthening its political might. Moreover, paralysing the state’s foundation, it has piled up several miseries on the masses, including a shortage in industrial productivity, rampant poverty, and the prevailing volatile state security environment. Nonetheless, the widespread energy crisis in the country is not sudden at all; it has taken a long time to progress. Multiple alarming ills exist behind the country’s sorry state of energy supply. Some noticeable culprits are the lack of consensus among the inter-provincial federal governments, fuel shortage, and using conventional technology in the power sector. However, since every cloud has a silver lining, Pakistan’s government can fix the problem of the energy crisis and put the country back on track progress after considering the priorities by developing harmony between the provincial and federal governments, utilizing alternative low-cost energy resources, and preferring the use of advance technology in the energy sector. Otherwise, prevalent darkness would become the country’s fate. The following answer highlights the ramifications, culprits, and remedies of the energy crisis in Pakistan.

There can be no sustainable development without sustainable energy development.”

Margot Wallstrom, Former Swedish Minister for Foreign Affairs

Before discussing how the energy crisis has served as a bottleneck in the supply of energy resources to the country, it is essential to highlight the current situation of the energy crisis in the country.

Pakistan is experiencing a severe energy crisis due to infrastructural bottlenecks and reliance on imported fossil fuels. As a result, the country has to face severe prolonged power outages due to the increasing fuel shortage and rising gap between electricity demand and supply. According to the Pakistan Economic Survey released by the coalition government in 2022, the demand for electricity in the country has surged to 28,200 megawatts while the power supply is 21,200 megawatts, with power shortfall surging to over 7,000 megawatts. Due to these worst energy shocks, the production in industries and foreign exchange reserves have been severely affected, and the nationhas been plunged into the swamp of poverty. Moreover, the rising violent protests against the ineptness of the government have disturbed the national defence to a great extent. Hence, the government must develop a comprehensive and integrated energy policy to ensure the state’s energy security to maintain its harmony.

Before highlighting the major culprits of the energy crisis, which have been breathed behind the miserable situation of the country, it is necessary to explore how the energy crisis has hampered the country’s progress.

In the economic realm, the counter effects of the energy crisis on the industrial and agricultural sectors have become a dreadful challenge for Pakistan. The manufacturing process of several industrial products andcrop productivity have been stifled by it. The leading reason behind this plight is the energy constraints due to which the gas and electricity supply to run factories and for agricultural harvesting and sorting processes have been shut down. Similarly, as per the report of the Ministry of Power, load shedding has reached 10-12 hours in cities mainly due to the non-availability of natural gas for power plants. In the presence of frequent load-shedding, the state could not collect enough revenue to maintain its economic stability. Therefore, according to the report of the Pakistan Economic Survey, the electricity shortages have cut GDP growth in the country by 4%. In short, energy insecurity has badly impacted the country’s Gross Domestic Product (GDP) by damaging its industrial and agricultural productivity.

Likewise, the power crisis has put a considerable burden on its already dwindling forex reserves in the presence of a trade imbalance in the country. As the energy outages delay work in industries, numerous textiles have remained unable to continue to export operations because cheap and unhindered electricity supply is unavailable to them. According to the All Pakistan Textile Mills Association’s (APTMA) report, 1,600 textile mills have already been closed in the country. Correspondingly, Pakistan suffered a loss of millions of dollars in its export income. Due to the trade imbalance, the country’s foreign exchange reserves have touched the lowest ebb, forcing the country to dance to the tunes of foreign monetary agencies to pay its import bills. To conclude, the shrinking of forex reserves in the energy crisis has overpowered all other concerns of the country. 

In addition to the economic realm, on social footing, the energy crisis has proved to be a catalyst for elevating poverty in the state. As the employment rate is directly linked to energy security, periodic disruption in the power supply has causedan industrial shutdown, ultimately triggering the unemployment rate in the country. Ironically, the unemployment rate lies at the core of poverty. Therefore, as per the research from the American nonprofit organization, the National Bureau of Economic Research (NBER), the unemployment rate is a significant determinant of poverty. Consequently, prevailing poverty drives people to spend their lives from hand to mouth. In the same way, the burgeoning social inequalities among the nation instigate them to commit crimes. By and large, the power crisis has become an alarming source of rampant poverty in the state. 

Apart from hampering the state’s socioeconomic fabric, energy scarcity has become an existential threat to its national security. The rampant energy shortage has given birth to various law and order problems by boosting thecivil unrest in the country. These frustrated people create chaos and anarchy in the state by participating in violent strikes. As Winston Churchill aptly stated above, petrol governs every movement. The burgeoning power crisis has become a cause of conflict between the public and the government, shattering the public’s confidence in the government. Furthermore, it damages the legitimacy and capacity of the state to counter the influence of insurgent groups. To summarize, Pakistan’s national defence is in jeopardy due to the prevalent darkness of the power shortage on its political might.

As several alarming reasons exist behind every conundrum, here, light would be thrown on the daunting culprits of the energy crisis, which has taken the country to the verge of destruction.

From the political perspective, the incompetent government in curbing the energy crisis has raised the miseries on the already crippling state’s foundation. Despite making various sustainable energy policies to produce energy, their implementation process is still absent in the state because of the lack of an integrated energy framework and the vested interests of politicians. The introduction of Independent Power Producers (IPPs) also could not resolve the issue. On the other hand, it has exposed the country to critical petroleum market volatility by increasing its petroleum imports. As per the latest data issued by the government in its Economic Survey (2021-2022), liquefied natural gas has witnessed an increase of 82.90 per cent in value, while liquefied petroleum gas (LPG) imports have also jumped by 39.86 per cent during July-April FY2022. Not only this but also the use of natural gas as CNG for the transport industry is further proof of these shortsighted policies. As a result, Pakistan has drowned in the sea of socioeconomic anomalies. Briefly, the ignorance of politicians to plan rational energy policies exists as a curse in the country to tackle the issue of energy insecurity.

The energy crisis in Pakistan has mounted towards its peak, which is an indication of fuel shortage. The burning causes behind the shortening of fuel in the country are high dependence on imported energy resources and overconsumption, making the country reel behind energy security. Where on the one side, skyrocketing oil prices in the global energy market owing to the ongoing Russia-Ukraine war have worsened the country’s fuel requirement. On the other hand, the lack of awareness in the public about consuming sufficient energy resources is not left behind. No one bothers to turn off extra lights, even in the National Assembly’s halls. Therefore, the Oil Companies Advisory Council (OCAC) warned that some regions of the country are currently experiencing a fuel shortage despite the increase in imports. In the manifestation of the fuel shortage, Pakistan has to face economic declivity, which has become a reason for social chaos and uncertainty in the country. In conclusion, the fuel shortage has inflamed the existing energy shortage in the country.

Likewise, Pakistan has teetered at the brink of an energy crisis as a result of energy transmission and distribution losses. Power thefts exploit the poor energy distribution infrastructures as a loophole to contributetoline losses in addition to meter inaccuracies. In this power loss, the inefficiency of the power sector management is also responsible. However, the impacts of electricity theft are not limited to power quality, resulting in load shedding and voltage dips. It causes revenue loss as well as a rise in circular debt. In fact, according to the report of the Pakistan Economic Survey, the country’s public sector distribution companies (DISCOs) have lost more than 2.8 billion rupees due to the short recovery of bills in more than 430,000 cases of electricity theft during the fiscal year 2020-2021. Unfortunately, the rising balance of payments crisis tarnishes the country’s image in the international community. On the whole, power line losses havejolted the country’s economic fabric.

Moreover, another miserable root of the power outages in Pakistan is the use of old technology in the energy sector, from power production to its distribution process. As a result of ageing and inefficient grids, much of the power supply has been reduced before reaching its destination. Therefore, the country is far behind in meeting the energy requirements of its public. The icing on the cake is that it also remains unable to produce sustainable energy from alternative energy resources, such as wind, water, and solar, due to not giving preference to the use of advanced technological tools in the power sector. Correspondingly, the country’s power sector has become bankrupt as a dire consequence of the delay in paying dues of its imported energy resources to independent power producers (IPPs). Sadly, as per the data of the Central Power Purchasing Authority (CPPA), the circular debt stood at Rs. 2467 billion by March 2022. The soaring circular debt in the country has severely disrupted the energy supply chain. In brief, the country’s energy crisis paints a bleak picture of using poor technology in the energy sector.

Last but not least, the power shortage in Pakistan is also an alarming result of the less vibrant role of media. Mainstream media does not pay attention to initiating productive discussions on leading social evils like the energy crisis. It does not take part in bringing awareness among the masses on overconsumption and provides guidelines about how to save expensive imported energy resources from wastage. On the contrary, a glaring consequence of the lack of awareness of the prevalent energy crisis is that the public, unfortunately, is busy bickering with each other on political affiliations. Therefore, Lumen Learning claims that media concentration on a few issues and subjects leads the public to perceive those issues as more important than other issues. Notwithstanding the root of the country’s social, economic, and, above all, political miseries, energy insecurity has remained ina shadow for many years, but it emerges as a nightmare and stands in front of the country now. To cut a long story short, the incompetent role of the media in raising the peril of the energy crisis in the country is included in one of the appalling factors that have pushed the country towards downfall.

Certainly, the energy crisis has proved to be an inevitable impediment in opposition to the country’s stability. In contrast, it is not an issue which cannot be solved. As every malady has its cure, some pragmatic solutions to address the rampant ramifications of energy insecurity may help the country to ameliorate the above-mentioned dilemma. 

The first and foremost solution to the rising energy shortage in Pakistan is to bring unity among the inter-provincial federal governments. Due to the prevailing concept of the blame game, the country’s institutions are now in a war-like situation. They do not pay attention to making comprehensive energy policies to improve the monitoring and evaluation of the uninterrupted energy supply. For instance, the launching of several new energy projects to conserve energy is still pending due to the ineptness of the government. So, to bring energy prosperity to the country, bringing all provincial governments under a single table on an integrated goal of proper energy policy implementation is a must.

Next to it, another preventive measure to fix the energy crisis in the country is to adopt alternative energy resources for power production. As Pakistan is rich in natural resources: water, solar, oil, gas, wind, and coal, the government should invest in its renewable energy resources to produce electricity from it instead of wasting millions of dollars on buying fuel from other countries. For example, since 35 per cent of hydro production can replace 62 per cent of thermal power, hydel power can be considered one of the cheapest sources of electricity generation for the country’s energy needs. Therefore, the government should focus on building various small and large dams to diversify its power supply in the country. Hence, electricity production through renewable resources can help the country to fizzle out the menace of the energy crisis.

Besides, it is also imperative for Pakistan to improve the working of its power sector authority to mitigate the energy crisis. To strengthen the power sector managers, the government should stop its intervention in their affairs, allow them to deal with the corrupt officers of the particular sector, and impose a heavy fine for power theft, resulting in line losses. Furthermore, if the managers want to invest in energy projects to improve the utilities’ performance, the government must give approval to their energy plans and allocate a special budget for them. As a result, it would be easy for the government to bring down its rising circular debt, making the country economically stable. In short, without strengthening its energy sector authority, the country could not minimize the rising power shortage.

Apart from other pragmatic measures against the prevailing energy crisis, the use of advanced technology in the power sector is also compulsory. For this purpose, the government should upgrade and maintain the electric grids. Along with maintaining the existing infrastructure, there isan urgent need to introduce modern technology in the energy sector for automation, efficient management, fault eradication, and the latest research and development tools to avoid undesired power cuts and transmission and distribution losses. These advanced technologies would help the country increase the frequency of its energy transmission system. Altogether, promoting modern technology in the energy sector can resolve the country’s issue of periodic blackouts.

Lastly, the mainstream media can be very productive in tackling the country’s energy shortage. Through awareness campaigns, it can give the energy shortage updates to the public. Also, it can make the masses aware of the bleak implications of the prolonged energy crisis, which can become a reason for the country’s nemesis in the near future. Not only this, but it also has a responsibility to guide the public to control the unnecessary use of electricity, and it can give suggestions to the government on the energy crisis management plans after constantly monitoring the energy shortage. In general, the effective use of media to disperse energy-saving-related beneficial information is included in one of the best remedial measures against energy shortages.

In a nutshell, the energy crisis has become a grave concern for Pakistan’s social and economic development. It challenges the country’s trade by affecting its industrial and agricultural output.  As a result, the country’s economic decline pushes its masses toward poverty. In contrast, there are several daunting factors behind the rising menace of the energy shortage- including the government’s ineptness and media, which demand the government’s attention to counter them. Hence, to alleviate the hurdle of the power shortage in the country, the government and media are required to play a vibrant role.

By and large, the energy crisis has become an alarming challenge for Pakistan’s prosperity. It exists in the country due to the negligence of the government in fuel shortage andthe inefficient role of the media in raising energy regarding awareness among its nation. Thus, it is high time that Pakistan took some rational actions to curtail the issue in the country. Nonetheless, it is only possible if both the country’s government and the media perform their duties efficiently and honestly. Through these measures, Pakistan would not only overpower the prevailing energy insecurity but also realize its dream of becoming an industrial and economically self-reliant nation.

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