“Those who would give up an essential liberty for temporary security deserve neither liberty nor security.” (Benjamin Franklin)
We are back to it again. The cause may be different, but the outcome is not. A new geopolitical event—this time a US-Israel attack on Iran—has once again exposed Pakistan to economic shocks and to our energy insecurities. If the event and the outcome are similar, our response is also not different. In a snap reaction, the government has raised fuel prices in the country, advising the nation to adopt austerity measures—necessary first steps, but ad hoc and issue-driven, as usual.
Such steps won’t secure the energy supplies we require for social and economic development or protect us from similar future threats. For that, Pakistan will need a vision-led systemic overhaul of its entire energy system—production, transportation, delivery, and utilisation—and transform it along the lines suggested below.
Energy undoubtedly is the lifeblood of modern society. It also underpins all other infrastructures, industries, and services in the country. The amount of energy required to produce a unit of GDP can be contested; what cannot be contested is that some basic amount of affordable energy is essential for the country’s economy and its people.
Pakistan currently suffers from abject energy poverty. Concurrently, it also faces serious risks to its current fuel supplies, which come mostly from abroad. Fossil fuel use for power generation, transportation, and industrial processes is also at the core of growing pollution in the world and the looming threat of climate change.
Pakistan faces a triple bind. It must provide affordable and reliable energy supplies to its economy and people while preserving its fragile environment. This is certainly a tall and daunting challenge, but as the adage goes, “When the going gets tough, the tough get going”. The country must find sustainable energy supplies to make its dreams of progress and prosperity come true.
Electricity, which is a derived form of energy, is a superior energy carrier due to its clean nature, ease of control, and versatility in application. As societies develop and their incomes rise, they switch from other forms of energy to electricity, frequently called moving up the “energy ladder”.
Electricity has also emerged as the preferred energy carrier of the world because, if derived from renewable sources using cleaner conversion technologies, it can enable the world to phase out its heavy reliance on fossil fuels, preserve its environment, and meet its energy needs sustainably.
Pakistan’s per capita annual energy consumption of 14 gigajoules is only 19% of the world average, 12% of that of the EU, 10% of that of China, and 51% of that of India (Energy Institute 2025). Its per capita annual electricity consumption of 463 kWh in 2023 was only 18% of the world average, 8% of that of the EU, 10% of that of China, and 50% of that of India (Ember online data).
Most analysts now agree that the primary cause of Pakistan’s energy poverty and insecurity is its existing energy system, which depends heavily on imported technologies and fuels
Pakistan’s per capita annual GDP of 1,478 US$ last year was only 11% of the world average, 3% of that of the EU average, 11% of that of China, and 55% of that of India (The World Bank’s WDIs). Only 70 to 75% of its population at present has access to electricity, meaning that 60 to 70 million people in Pakistan are still without this basic service (NEPRA 2024, p.11).
Of the total 80.5 million tonnes of oil equivalent (toe) primary energy supplies during 2024, we imported 42.71 million toe (or 49%), and over 14.5 million toe (or 35%) of the annual fuel imports went to power generation, costing the country over US$ 22 billion (excluding coal imports).
Pakistan’s energy intensity—a proxy measure of the country’s economic efficiency—is also very high. A recent World Bank study estimated Pakistan’s energy intensity to be around 4.2 megajoules (MJ) per US$ compared to 1.9 for Bangladesh and 1.7 for Sri Lanka (The World Bank, 2026).
The above statistics show that Pakistan faces abject energy poverty. At the same time, it is quite lavish in using its energy supplies, most of which come from abroad. These three factors, in confluence, pose serious risks to our people, economy, and sovereignty.
Energy poverty may not be the sole cause of Pakistan’s economic poverty, but it is certainly among the key factors. It is problematic for several reasons. The most critical is its “affordability” for common citizens, industries, and commercial businesses.
Since the risks of fuel supply disruption or price volatility are serious, it is tempting to consider total indigenisation of our energy supplies. For several reasons, this may not be practicable. Energy infrastructure is both capital-intensive and long-lived. Once in place, it locks the nation into energy supply and consumption patterns that are both difficult and expensive to change. We will need to tread very carefully.
In today’s world, chasing objectives like energy independence or self-reliance (by shifting to local resources for all energy needs) certainly sounds appealing, but will not be practicable or even worth the cost. It will also negate what the world has achieved by cooperating and harnessing the comparative advantage of different countries in certain physical and natural resources. We should focus on building “energy security”, which will be more realistic.
Energy security for a country generally means the availability of uninterrupted energy supplies at affordable costs. It is based on four threads: (i) availability—the ability of a country to secure its energy through extensive commercial markets and sufficient resources, technology, and legal frameworks; (ii) reliability—the extent to which energy services are protected from disruption through diversity of energy sources and suppliers, and resilience to shocks; (iii) affordability—low and equitable prices relative to income and their stability; and (iv) sustainability—minimal environmental damage resulting from the energy system.
Many countries have tried to eliminate their dependence on foreign energy supplies but have had to settle for indigenisation well below 100%. Instead, they improved their energy security through a myriad of other efforts.
Japan, for example, lacks commercial energy resources but still ranks among the most energy-secure countries, mainly because of its strong economic ties with energy suppliers and other developed countries.
China also depends heavily on foreign sources, but any serious disruption to its energy supplies is implausible since the economies of many developed and fuel-exporting countries depend significantly on the supply of cheaper products from China.
A singular focus on import reduction or indigenisation will not address the multiple political, social, economic, and environmental impacts of energy supplies. Many additional considerations should drive our energy policies and plans.
Pakistan must pull out of its energy poverty and recast its entire energy system around supplies that are more secure and sustainable. Both are complex and multi-faceted issues and involve a host of sub-issues like low incomes, high prices, lack of access, and inefficient building practices and technologies.
Most analysts now agree that the primary cause of Pakistan’s energy poverty and insecurity is its existing energy system, which depends heavily on imported technologies and fuels. This approach has failed to deliver and has led to energy supplies that are prohibitively expensive, inequitable, insecure, and unsustainable.
The world around us is turbulent and may remain so for quite some time. Uncertainty and instability may dominate global energy markets. Prudence demands that we prepare to navigate these times by avoiding locking our energy system into long-term fuel supplies, especially those subject to disruptions and price shocks from conflicts like the present one.
Our leaders will need to look beyond their success in the next general elections. They must demonstrate wisdom, foresight, and sagacity to steer the nation through turbulent times using a suite of actions and reforms that we suggest in the second part of this article.