Energy imports – an emerging threat to economy
ISLAMABAD: The trade gap and debt trap are being forecast as two major risks to Pakistan’s economy.
An interim fall in oil prices over the past two years led to a decrease in energy imports from $15 billion in 2013 to $12 billion last year, but they are poised to increase due to the rising trend in oil market.
Power and transport sectors together consume two-thirds of energy requirements. Pakistan imports 38% of its energy requirements. Compared to energy imports, Pakistan’s exports stand at only $21 billion.
We can safely conclude that the energy import bill amounts to 59% of Pakistan’s total exports. The unintended consequence of increased energy supplies will be energy imports, leading to worsening of the current account deficit. The good news is that the energy crisis is about to end with the import of liquefied natural gas (LNG) and addition of 10,000-megawatt electric power plants.
Published in The Express Tribune, 14th May, 2018