ISLAMABAD: The government has budgeted Rs406 billion – in addition to the regular subsidy for electricity bills (TDS) – to stem the growth of the circular debt despite tariff increase.

Sources in the Finance Ministry said that as per official data, the government has utilised Rs2,707 billion to stem the growth of circular debt from 2011-24 and for the ongoing fiscal year an amount of Rs460 billion has been budgeted for this purpose. They added that this amount is in addition to the regular subsidy provided on electricity bills (TDS).

Sources further stated that as per year-wise data with regard to stock clearance of circular debt, the government had utilised Rs312 billion in the fiscal year 2011-12 to stem the growth of circular debt.

Power sector’s circular debt reaches Rs2,655bn by May

In the subsequent fiscal year 2012-13, the government had utilised Rs342 billion to stop the growth of the circular debt and Rs138 billion was utilised in the following fiscal year of 2013-14.

As per data, however, no amount was budgeted for this purpose from 2014-15 till 2019-20 but in the fiscal year 2020-21, the government utilised Rs167 billion to stem the growth of the circular debt while in the following fiscal year of 2021-22, an amount of Rs516 billion for this purpose.

In the subsequent fiscal year 2022-23, the government utilised Rs215 billion to stop the growth of circular debt while in the fiscal year 2023-24, Rs556 billion was utilised to stem the growth of circular debt.

According to official data, the government has budgeted Rs461 billion for the current fiscal year to stem growth in circular debt.

An amount of Rs2,707 billion had been utilised from 2011-2024 to stem the growth of the circular debt. This amount is in addition to the regular subsidy provided on electricity bills (TDS), as per official data.

Copyright Business Recorder, 2024