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The demand for energy2
is expected to rise sharply as a country develops3
. In 1971,
the share of developing countries in the world energy consumption was only 15 percent, it
increased to 27 percent in 1991, and it is expected to rise to 40 percent by the year 2010 (see
Schneider (1994)). This rise in energy consumption is linked with industrialization and
urbanization in these countries. Energy Intensity is, also, expected to rise initially with
industrialization, then decline and ultimately settle down at a higher energy intensity ratio.
In Pakistan, the demand and supply, both, have expanded very rapidly (see Table 1).
However, for different energy sources, the coefficient varies significantly (see Table 2).4
For
electricity, the energy coefficient is quite high and it may decline as efficiency in the use of
electricity rises. The energy coefficient for natural gas is declining, which may be an
indicator of improved efficiency in gas use as output grows.
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