Pakistan faces a potential delay in receiving a $1 billion tranche of an IMF loan scheduled for March.

The IMF has made it a condition that gas supplies to captive power plants in the industrial sector be cut off by the end of January.

The IMF argues that these plants should either switch to grid electricity or pay equivalent costs, demanding that the government impose substantial taxes on gas supplied to these plants to eliminate cost advantages over grid power.

Under the agreement with the IMF, the government is obligated to cut off gas to captive power plants from February 2025 to secure the $1 billion tranche.

Textile exporters, however, warn that cutting off gas supply to industrial units will harm their export competitiveness.