The IT Ministry says telecom has held industrial status since 2004, while the National Assembly committee has summoned NEPRA officials to explain why industrial power tariffs remain unavailable.
ISLAMABAD: The Ministry of Information Technology and Telecommunication has asked the National Electric Power Regulatory Authority (NEPRA) to treat the telecom sector as an industry for electricity tariff purposes, reviving a dispute that has continued for more than two decades.
In a written response submitted to the National Assembly’s Standing Committee on IT and Telecom, the ministry argued that telecom operators should receive industrial electricity rates rather than continue to be billed under commercial tariffs.
The ministry’s position comes after the committee sought a formal written response on the matter. It maintains that telecom was granted industrial status through a Ministry of Industries and Production notification in 2004, but that status has not translated into industrial electricity tariffs for cellular towers and exchanges.
The ministry also pointed to a subsequent legal development. The Finance Act 2021 included telecom in the definition of an “industrial undertaking” under the Income Tax Ordinance, 2001, reinforcing the sector’s industrial classification.
According to the ministry’s submission, the continued application of commercial electricity rates therefore creates a conflict between the sector’s established legal classification and NEPRA’s position on tariff eligibility.
The dispute previously came before NEPRA in 2022, when the regulator rejected a petition filed by PTCL, Telenor, PTML, PMCL and other telecom operators. NEPRA maintained that the “value addition” requirement for industrial tariff eligibility applied to manufacturing and production rather than telecom services.
The issue has now moved back into the parliamentary arena. The National Assembly’s Standing Committee has summoned NEPRA officials to explain why industrial tariffs have not been extended to telecom operators.
The ministry’s response also raises concerns about power outages affecting telecom infrastructure. Interruptions at cellular towers and exchanges can affect service quality and disrupt connectivity for users, including freelancers and other internet-dependent segments of the economy.
One proposal under discussion is the allocation of express feeders to telecom infrastructure. Such feeders provide uninterrupted electricity to designated facilities and are also used for export-oriented industries. The measure could help protect telecom towers and exchanges from scheduled load-shedding, separately from the broader dispute over tariff classification.
The ministry has argued that an industrial tariff would reduce electricity costs for telecom operators. The sector has pursued the issue for years, including through the 2022 NEPRA proceedings.
About The Author
