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Circular debt monster


Circular debt monster
March 01, 2021
The power sector circular debt is set to cross Rs2.6 trillion by the end of the ongoing fiscal year i.e. FY2020-21. This is what Power Division’s Additional Secretary has told the National Assembly’s Stan¬ding Committee on Finance during a meeting last week. The crippling debt stood at Rs2.164 trillion as of June 30, 2020 and at Rs2.303 trillion as of December 31, 2020. This shows an addition of Rs436 billion during the ongoing fiscal year, of which Rs297 billion accounts for the second half.
The federal government had recently raised the power tariff by Rs1.95 per unit in fulfillment of a condition for revival of the $6 billion IMF loan programme expecting that the accumulation of the circular debt will slow down significantly. However, despite burdening the masses especially the lifeline consumers for whom the Rs1.95 per unit raise in power tariff means electricity getting doubly expensive the circular debt accumulati ....

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