About 90 per cent of households in Indian Punjab receive zero electricity bills under the 300-units-per-month scheme. Imagine: Indian Punjab gives zero electricity bills to nearly nine out of 10 households, roughly seven to eight million families.
Question: Is this really free electricity? Answer: No, it is not free electricity, but the bill is shifted from consumers to the provincial budget. How does the Indian Punjab government do it? It pays Punjab State Power Corporation Limited (PSPCL), the electricity generating and distribution company, the equivalent of $2 billion. The $2 billion (equivalent) comes from revenue receipts, central transfers, taxes and excise. The $2 billion (equivalent) is roughly 18 per cent of revenue receipts.
This is how it works: Punjab bills every two months. Up to 600 units in two months: zero bill for domestic consumers. If a general-category household crosses 600 units, it pays for the full consumption.
The reality: Indian Punjab has made electricity a budget item. The consumer does not pay at the metre. The government pays through the treasury. The purpose is not to abolish the bill. The purpose is to change who pays the bill.
Cold truth: A free unit is never free. Someone pays. The only question is: the poor household — or the treasury.
Can Lahore copy Amritsar? The arithmetic is manageable.
The writer is an Islamabad-based columnist.
