The Pakistan Government is planning to increase its power tariff by 2-3% each month, in compliance with conditions set by the IMF and World Bank.

The monthly increase will result in a minimum power increase of 19.4% and a maximum of 30.4% at the end of June 2011, according to The News.

The government has increased the power tariff by 63.6% during the last 30 months, and with this proposed increase, will register a total increase of 94% at the end of this fiscal year.

If the increases are not implemented, the government needs at least PKR226bn ($2.6bn) per month to gap the power subsidies.

The monthly increase of 2% starting from 1 October 2010 will generate PKR42bn ($0.48bn), while a 3% increase will also generate revenue of PKR64 billion ($0.7bn) to gap the actual cost of the power generation.