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CSS Economics of Pakistan P-II QUESTION #1711
Question 1
Pakistan's primary energy mix has historically been characterised by a structural dependence on which energy source, making the country highly vulnerable to global commodity price shocks and foreign exchange pressures?
  • Domestically generated renewable energy (solar, wind, hydro)
  • Imported fossil fuels — particularly furnace oil and liquefied natural gas (LNG)✔️
  • Nuclear energy as the baseload generation source
  • None of these
Correct Answer Explanation
Pakistan's electricity generation has been heavily reliant on imported furnace oil (for thermal power plants) and, more recently, imported LNG. This dependence on imported fossil fuels creates a double vulnerability: (1) exposure to volatile global oil and gas prices, and (2) severe foreign exchange drain contributing to balance of payments pressure. The circular debt crisis in the power sector is partly rooted in this structural dependency on expensive imported fuels.