Karachi is the largest city of Pakistan, and its proud economic nucleus, that fuels the nation’s fiscal, industrial, and commercial lifelines. K-Electric (KE), in turn, serves as the artery that sustains this economic heart. This equation is self-evident and requires no elaborate justification. A city of nearly 30 million people, contributing close to half of Pakistan’s tax revenue, cannot afford instability in its power supply. Yet, unlike other provinces that receive preferential infrastructure attention, Karachi continues to shoulder the demands of trade, technology, and rapid urban growth largely on its own. Despite this neglect, the city remains remarkably resilient, open, productive, and indispensable to Pakistan’s economic continuity.

To undermine the interests of a city that contributes boundlessly while demanding so little is both economically irrational and strategically myopic. With a single regulatory stroke, years of structural reform and painstaking institutional progress have been dismantled. What has been undone overnight is not just a tariff structure, but the very credibility of Pakistan’s energy governance and privatization narrative.

As an active citizen of Karachi, I have personally witnessed the darkest days of the old Karachi Electric Supply Corporation (KESC) era, when the city was crippled by load-shedding, theft, and mismanagement. The subsequent transformation remains a classic case study and a valuable reference for the privatization of other DISCOs across Pakistan. It stands as proof that reform, transparency, and privatesector efficiency can truly deliver.

The National Electric Power Regulatory Authority’s (NEPRA) decision to retroactively reduce KE’s multi-year tariff by PKR 7.6 per unit represents a profound policy misstep, one that threatens to unravel Karachi’s fragile energy equilibrium and, by extension, Pakistan’s broader economic stability. This reversal risks resurrecting the darkness that once paralyzed Karachi.

The irony is that NEPRA has framed this decision as relief for consumers, yet Karachi’s citizens will not see any reduction in their bills. In fact, bills are set to rise due to revised fuel cost adjustments embedded in the new decision. So where do these “savings” go? – straight into the federal ledger! The government has effectively withdrawn the subsidies provided to Karachi’s electricity consumers and transferred the fiscal burden entirely onto KE’s balance sheet. This has created a financial crater, estimated at over PKR 200 billion, for just the past two years. Do we call this ‘discipline’ or a fiscal sleight of hand? This move reallocates resources away from Pakistan’s most productive economic zone to destinations far less capable of generating returns.

Quoting the CEO of KE, 2.5 years of rigorous regulatory engagement had led to a modest profit of PKR 4.13 billion in September 2025, a mere 3.56% return on equity, far below commercial benchmarks but accepted in good faith for the stability it promised. Having the distinction of being the only power company that does not contribute to circular debt, it now faces a PKR80 billion loss. A financially viable enterprise serving 30 million people has been rendered technically insolvent by regulatory fiat. A mutually agreed-upon Multi-Year Tariff (MYT) that took over two years to build has been revised unjustifiably, forcing the organization to reconsider its future operations.

The company’s 7-year investment plan, requiring USD 2 billion for critical infrastructure, transmission networks, generation fleet maintenance, and cyber security upgrades, has collapsed along with lender confidence.

Advanced discussions with multilateral institutions for long-term financing will now stall. Even if these decisions are reversed, the damage to Pakistan’s regulatory credibility may prove irreparable.

To reinforce the impact of privatization, allow me to recount that technical losses dropped from 43% to 20%, generation efficiency improved from 30% to 43%, and the cost savings to the national exchequer from these improvements alone ran into hundreds of billions. That progress now hangs by a thread. If KE cannot secure financing, if infrastructure investments halt, and if maintenance is deferred due to financial distress, Karachi will slide back toward the darkness that once defined it.

Saudi Arabia and other Gulf investors who have shown serious interest in Pakistan’s energy sector, seeing potential in DISCO privatization and infrastructure modernization, are not happy and have shown their serious disappointment. In fact, have now filed a legal notice of USD 2 billion against Pakistan. What message is NEPRA conveying? Are these regulatory frameworks fluid? Can profitable enterprises be rendered insolvent overnight through retroactive policy changes? Are investment returns subject to arbitrary revision years after deals are concluded? This serious escalation not only damages Pakistan’s reputation as an investment destination but also undermines ongoing efforts to attract Foreign Direct Investment (FDI).

Moving to the bigger picture, my question is to the stakeholders who continue to promote the idea of converting State-Owned Enterprises (SOEs) into private entities for a stronger economy. The KE case was supposed to be Pakistan’s privatization success story, proof that reform works, that private-sector efficiency can transform SOEs, and that international capital can find stable returns in Pakistani infrastructure. Instead, it is becoming a cautionary tale that will echo in every future negotiation with potential investors.

NEPRA’s change of heart raises fundamental questions that demand transparent, public answers. The issues are significant, whether it is the need for energy sector reforms, DISCO privatization, or foreign investment in infrastructure. All arguments aside, we must ensure that Karachi’s powered economy must grow consistently for Pakistan to reposition itself as a regional hub and, eventually, a global economic power. But we cannot achieve these goals through opaque, retroactive regulatory reversals that destroy investor confidence and institutional credibility.

That progress is now under threat from policymaking that appears linear at best and reckless at worst. We cannot afford governance that creates hundred-billionrupee financial holes with midnight announcements and no consultation.

At this critical juncture, I humbly appeal to the leadership of the State, President of Pakistan Asif Ali Zardari, Prime Minister Shehbaz Sharif, Deputy Prime Minister and Foreign Minister Senator Muhammad Ishaq Dar, Chief of Army Staff & Field Marshal Syed Asim Munir, Finance Minister Senator Muhammad Aurangzeb, and Power Minister Sardar Awais Ahmad Khan Leghari, to urgently intervene in this matter. Their collective wisdom and leadership are essential to restore investor confidence, protect Karachi’s economic engine, and safeguard Pakistan’s energy future.

At the same time, I strongly recommend the civilian and military leadership engage the best neutral experts to independently assess the factual situation, supported by credible data. I believe that some individuals may be misleading the leadership because of their vested interests and insecurities. They are manipulating matters to serve personal agendas rather than national interest. A neutral and data-driven review is the only way forward to uncover facts and protect Pakistan’s credibility.

NEPRA and the federal government have a lot to answer for, and I hope they do so in the interest of the 30 million Karachi residents whose lives depend on reliable electricity to make this country progress. Let us not forget that the remaining 220 million people of Pakistan also depend on Karachi’s progress to fuel their aspirations.

Karachi works for Pakistan, and KE enables that. And above all arguments (for sanity’s sake) we must ensure that KE proves to be the best-case study for Saudi investment in Pakistan. We have a lot to gain from that.