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The financial position of power sector deteriorated and circular debt increased during the previous government's tenure from 2013-18 subsequent to a steady rise in receivables against federal and provincial governments, private sector, agriculture tubewells in Balochistan, AJK and Fata. Concurrently, power sector's payables to the power producers and gas and oil companies have also soared.
Sources said the financial position of power sector can be improved after reduction in circular debt, subject to the recovery from all the consumers. Sources said that power sector receivables with a steady increase every year rose to Rs 891 billion in 2017-18 from Rs 411 billion in 2013 and payables surged to Rs 544 billion from Rs 265 billion.
The receivables of power sector against the federal government increased from Rs 4.6 billion to Rs 7.8 billion during 2017-18, AJK government from Rs 24 billion to Rs 99.3 billion, Federally Administered Tribal Areas (FATA) from Rs 20.3 billion in 2013 to Rs 26.9 billion, as well as against agriculture tube wells in Balochistan from Rs 1.2 billion in 2013 to Rs 232.5 billion in 2017-18 while against Karachi Electric (KE) from Rs 26.8 billion to Rs 73.4 billion. Power sector receivables against provincial governments, however, decreased from Rs 74 billion in 2013 to Rs 40.4 billion in 2017-18 and against private (Disco) increased from Rs 260 billion to Rs 411.4 billion during the five years.
Likewise, power sector payables position also worsened during the last five years with power sector payables increased from Rs 207.2 billion in 2013 to Rs 543.9 billion in 2017-18. This included increase in power sector payables to IPPs from Rs 74.9 billion in 2013 to Rs 368.2 billion in 2017-18, Gencos to Rs 16.4 billion while payables for oil companies increased from Rs 4.5 billion in 2013 to Rs 65.2 billion in 2017-18 and gas companies from Rs 5.8 billion to Rs 20.9 billion.
However power sector payables to Wapda Hydel/NTDC and others decreased from Rs 121.9 billion in 2013 to Rs 73.2 billion in 2017-18. An official said that now the government is vigilant with regard to maintaining circular debt at a reasonable level. However, receivables/payables are inherent phenomena and government is also striving to clear the dues of power producers.
At preset heavy amounts are outstanding against provinces and provision of further administrative support in Sindh and Balochistan can improve recovery position. Due to law and order situation in Sindh and Balochistan, huge arrears are stuck up.
However, efforts are being made for recovery of these receivables. DISCOs' receivables from provincial governments stood at Rs 40.38 billion by end of June 2018, out of which Rs 18.6 billion to Khyber Pakhtunkhwa. In addition Rs 99.27 billion are against AJ&K and Rs 73.5 billion against KESC, etc. Power sector receivables against agricultural tube wells in Balochistan have reached Rs 232.46 billion.

Copyright Business Recorder, 2018

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