ISLAMABAD. The federal government has decided to adopt an IMF-nodded plan to overcome the increasing circular debt of power sector.
The government has announced to bring down circular debt of Rs303.137 billion to Rs204.417 billion by fiscal year 2018. The rulers have planned to bring down the said debt by shifting the whole burden to the electricity consumers. The government has also planned to reduce the Power Holding Company Limited (PHCL) debt from Rs335 billion to Rs140 billion by financial year 2018.
With a view to reducing the circular debt, the government will recover the full cost of electricity production and supply from consumers through bridging the gap between Nepra determined tariff and the government notified tariff. So far the gap has substantially been bridged through the surcharges levied on the electricity bills in the name of tariff rationalisation.
According to the Ministry of Water and Power officials, the compliant consumers have been punished by forcing them to pay all government and system inefficiencies amounting to Rs200 billion and in addition they will also be forced to pay Rs40 billion in the head of debt servicing.
