Pakistan’s power sector circular debt is set to approach Rs. 1.9 trillion, rising from Rs. 1.689 trillion recorded during the first half of fiscal year 2025 to 26, highlighting renewed stress in the country’s energy sector finances.
The key development is the sharp increase in debt stock to Rs. 1.889 trillion as of February 28, 2026, with liabilities linked to China-Pakistan Economic Corridor power projects touching an all-time high of Rs. 543 billion, reported Business Recorder.
The nearly Rs. 200 billion jump in just two months has been attributed to lower recoveries and higher system losses compared to targets set by the National Electric Power Regulatory Authority, raising fresh concerns from the International Monetary Fund over the issue’s economic impact.
Officials had earlier committed to bringing circular debt down to Rs. 1.614 trillion by the end of the current fiscal year, though medium term targets have now been revised upward to Rs. 1.346 trillion by June 2027.
To contain the situation, the government recently approved a Rs. 200 billion technical supplementary grant structured as equity support for distribution companies, while consumers continue to bear a debt service surcharge of Rs. 3.23 per unit.
The issue is expected to remain a key policy concern as Pakistan engages with the IMF on energy sector reforms and as the matter comes up for discussion at Nepra’s public hearing on fuel charges adjustment for February 2026.
What is the problem my friends. Circular debt. What nonsense is this, never ending. This is all daylight robbery and we the fools kerp on accepting it lying down. Nonsense is a very mild word.
Thanks to form 47 incompetant govt.
Who’s fault is that ?