More outages feared as circular debt rises

ICCI cautions oil-based power will disappear if PSO’s dues are not cleared

ISLAMABAD: The Islamabad Chamber of Commerce and Industry (ICCI) has voiced concern over the rising circular debt that has reached Rs573 billion and is expected to lead to more load-shedding and affect production activities.

It urged the government to take urgent measures to clear the debt in order to save the economy from its damaging consequences.

In a statement, ICCI President Sheikh Amir Waheed recalled that the circular debt had exceeded Rs500 billion in May 2013 and the current government, after coming to power, cleared Rs480 billion worth of debt in June that year, after which it was hoped that the issue would not rear its head again.



However, contrary to expectations, the circular debt again crossed Rs500 billion in May 2018, which showed that no concrete measures had been taken to resolve the critical issue. He said Pakistan was producing about 9,000 megawatts of electricity with oil as fuel whereas receivables of Pakistan State Oil (PSO) had increased to over Rs300 billion.



He was afraid that if PSO’s payments were not cleared, it would not be in a position to ensure oil supply due to which oil-based electricity would disappear from the system, creating serious power crisis in the country.

ICCI Senior Vice President Muhammad Naveed Malik and Vice President Nisar Mirza pointed out that as per figures of the Pakistan Electric Power Company, there were a total of 8,631 feeders in the country, of which a majority were facing 10% losses while others were enduring 80% losses.



They stressed the need for developing a mechanism to control transmission and distribution losses along with feeder losses that would bring significant improvement in power supply, enabling businesses and industries to flourish in the country.

Published in The Express Tribune, May 31^st, 2018.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.