Circular debt to be eliminated by end 2020, PM told

20% energy to be generated by alternate sources by 2025

ISLAMABAD: Circular debt, which increased by Rs450 billion during 2017-18, would be eliminated by next year, Prime Minister Imran Khan was informed on Monday.

Chairing a high-level meeting to discuss the developments and reforms in the energy sector, the premier was briefed by the energy ministry's power division about reforms in the power sector, including the target to get rid of circular debt by December 2020.

Power Division Secretary Irfan Ali informed the meeting about efforts for removing impediments in power transmission, measures to curb power theft and cope with the issue of circular debt.

Circular debt, caused by debt piled up due to electricity leakages, theft and low recovery of bills from many state-owned offices, schools, police stations, mosques, monuments and others, has crossed the Rs1.4 trillion mark.

The meeting was informed that circular debt would be brought down to Rs293 billion during the current year and to Rs96 billion by 2019-20. The prime minister was told that a 25-year plan for coping demand and supply of power had been formulated.

Moreover, a fresh policy for power production through alternate energy resources had been formulated. Under the policy, 20 per cent of total electricity would be produced from alternate resources by 2025 which would be enhanced to 30 per cent by 2030.

It was told that the ministry's drive to curb power theft and recovery of dues had brought in positive outcomes. Within four months, the additional power dues worth Rs48 billion had been recovered that would touch Rs80 billion mark by year end and Rs190 billion till June 2020. The prime minister was told that the special focus given to handling the losses caused by theft, technical and transmission issues was coming to fruition.

As a step to curb power theft, 27,000 first information reports (FIR) had been registered against those involved, while 4,225 people had been arrested including 433 officials of the power sector. Moreover, another 1,467 officials had been charge-sheeted.

During the briefing, it was informed that the production capacity of the power system had been enhanced by 3,000 megawatt (MW) through addressing 15 major shortcomings.

The premier was assured that no power load shedding would be done on 80 per cent feeders across the country during the holy month of Ramazan due to improved distribution and transmission system.

For the remaining 20 per cent feeders, a load management plan had been formulated in accordance with the losses and where the ratio of power theft was above 80 per cent. However, it has been ensured to provide uninterrupted power supply during sehr and iftar.



While discussing the power tariff, the meeting was told that the previous governments had failed to incorporate the expenses incurred on net hydel profits and different power projects in the power tariff, which was resulting in consumers bearing an additional burden. The previous governments had announced subsidies for different sectors but had not allocated the required amount in the budget which made the power sector suffer.

Briefing on the petroleum sector, the authorities concerned told that the policy for exploration and production was being amended and a shale policy was also on the cards for the first time. Moreover, the exploration and production sectors were being bifurcated.

The prime minister was told that 40 blocks had been identified for exploration and production, and that international road shows would be conducted to attract technically-equipped foreign firms so that the oil and gas reserves could be exploited.

The meeting was attended by Minister for Power Omar Ayub Khan, Finance Advisor Abdul Hafeez Sheikh, Special Assistant to the Prime Minister (SAPM) on Petroleum Nadeem Babar, SAPM on Information Dr Firdous Ashiq Awan, PM Spokesperson Nadeem Afzal Chan, SAPM Yousuf Baig Mirza, Power Division Secretary Irfan Ali and other senior officers, a PM Office statement said.

With additional input from APP