It is Pakistan’s most predictable game: police teams roll into a neighborhood, cut down illegal wires, pose for photographs, and drive away. By sunset, these illegal wires, the kundas, are back up, humming quietly in the dark.
At its core, Pakistan’s electricity-theft problem cannot be understood as merely a law-and-order problem. In many communities, it is also a response to unaffordable electricity, weak enforcement, and distorted incentives. Until policymakers address the underlying microeconomic drivers, heavy-handed deterrence will deliver nothing more than temporary relief.
The Tariff-Theft Death Spiral
At the heart of electricity theft is a vicious cycle. To account for accumulated sector debt, expensive power purchase obligations, exchange-rate pressures and unpaid bills, electricity tariffs and periodic adjustments have risen substantially. But with every price hike, legal electricity becomes more unaffordable for ordinary families, making illegal kunda connections seem like the feasible option left to keep the lights on.
Each price hike increases the financial meter to bypass the meter. For struggling middle and low income households facing double-digit inflation, the price of legal electricity rapidly outpaces household budgets. At the same time, higher income households and businesses are increasingly reducing their dependence on the grid through rooftop solar and other decentralised energy systems. According to the Federal Minister for Power Awais Leghari, Pakistan had an estimated 20,000–22,000 MW of distributed solar capacity in early 2026, of which around 6,000–7,000 MW was operating under net-metering arrangements.
As reliable paying consumers generate their own power and cut grid usage, distribution companies (DISCOs) can face a shrinking sales volume while their massive fixed operational costs remain unchanged. To recover these fixed costs, DISCOs press for further tariff increases on the remaining customer base. This fuels a destructive feedback loop: higher rates push wealthier users to off-grid solar and financially constrained families toward default or illegal hooks, widening the gap between those who can afford to escape the grid and those trapped within it.
The Bribe Machine on the Ground
Beyond consumer affordability, kunda operations rely on an entrenched principal-agent failure within power distribution utilities. Illegal hook connections are not always isolated acts by individual consumers. In some areas, they operate through informal arrangements involving local intermediaries and utility field staff, according to documented accounts.
This dynamic presents a classic principal-agent problem. While DISCO executives and the Ministry of Energy (the principal) seek to maximize revenue collection and minimize line losses, local field workers and informal networks often described as the “power mafia” (the agent) face powerful incentives to extract private rents.
Linemen charge consumers a fixed monthly bribe, substantially lower than an official electricity bill, to install and protect kunda lines. The unmetered electricity is subsequently written off and misreported. Because the local mafia profits directly from preserving the illegal network, top-down administrative orders and police crackdowns achieve little lasting success on the ground.
A Roadmap Beyond Coercion
Solving the kunda crisis requires shifting from reactive policing to structural economic reform. Policy efforts must focus on three interconnected pillars:
First, Secure the Wires. DISCOs must accelerate the rollout of Aerial Bundled Cables (ABC) and Advanced Metering Infrastructure (AMI). Insulated overhead cables render physical wire-tapping technically difficult, while smart meters on distribution transformers allow utilities to pinpoint exact loss points automatically, removing reliance on field staff discretion.
Second, Governance Restructuring. Centralized administration has proven incapable of curbing localized theft. DISCOs should be transitioned to provincial management or long-term private concessions. Localized governance could make utility management more accountable to the communities and institutions responsible for enforcement, while reducing the distance between those making operational decisions and those dealing with electricity theft on the ground.
Third, Targeted Subsidy Realignment. In high-loss feeders, kunda often serves as an unbudgeted, informal survival mechanism for low-income communities. Instead of relying on distortionary cross-subsidies embedded in general tariffs, vulnerable households must be supported through direct, targeted electricity credits linked to social safety frameworks like the Benazir Income Support Programme (BISP).
Concluding Remarks
Law enforcement can briefly suppress illegal hooks, but it cannot override basic microeconomic incentives. When legal electricity becomes unaffordable and field governance rewards rent-seeking, theft will inevitably adapt to police raids. Transforming illegal hooks into legal, revenue-generating connections requires aligning market incentives, upgrading infrastructure, and modernizing governance. Until those structural fixes occur, the economics of kunda will continue to prevail over the authority of the state.
