Pakistan has presented a plan to the International Monetary Fund (IMF) to address the growing circular debt (CD) in the gas sector, estimated to be Rs1.6 trillion. The plan, subject to IMF approval, involves non-cash adjustments and tariff rationalisation. The government aims to gradually implement the plan over the next few quarters. The plan was finalised on Aug 4 and seeks to reduce circular debt in the gas sector to improve the country’s macroeconomic indicators and promote economic growth. Under the plan, the federal government will inject Rs414 billion into Sui Northern and Sui Southern gas companies to pay outstanding dues to gas producers. In return for this injection, the gas companies will provide the government with Rs475 billion in dividends. This book adjustment and injection of funds will reduce the overall circular debt by about Rs543 billion. Another part of the plan is to implement Ogra’s determinations to increase gas rates by 45-50%. This increase will provide additional funds to the gas companies. The government also plans to undertake price-setting reforms in the gas sector to help reduce power generation costs. The IMF has emphasized the need to address the circular debt in the gas sector, and the government has committed to implementing reforms and establishing a circular debt management plan.


>Source link>

>>Join our Facebook Group be part of community. <<

By hassani

Leave a Reply

Your email address will not be published. Required fields are marked *