Optics over sense

The chief minister of Punjab recently announced a reduction of Rs14 per unit for electricity consumers using up to 500 units. This relief is only temporary – after two months (August and September), consumers will be back to paying the actual cost. Interestingly, many households, even those with two air conditioners, use less than 500 units of electricity. This means that the relief is not just reaching those who truly need government support but also those who can afford to pay the actual cost. This broad approach raises questions about whether the subsidy is being used wisely.

We have seen a similar situation before when the PTI government kept petrol prices artificially low at Rs150 per liter, despite skyrocketing international oil prices due to the Russia-Ukraine conflict. The result was billions of rupees in losses. From an economic perspective, prioritizing short-term relief over development spending is risky. Development projects typically offer long-term benefits, improving infrastructure, healthcare, and education, and helping to build a stronger future. Instead of offering blanket subsidies, it might be better for the government to focus on sustainable solutions that can provide lasting benefits for everyone.

Salman Ahmed Ansari

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