Circular debt payment: Ishaq Dar explains the numbers

Finance minister says bonds, expenditure cut and recovered dividends helped in repaying circular debt.

ISLAMABAD: In the face of growing criticism over how the government paid the circular debt, Finance Minister Ishaq Dar on Wednesday explained the breakdown of payments. 

Speaking during a cabinet meeting in Islamabad, Dar said the circular debt amounted to Rs480 billion when he took charge as finance minister.

According to the data provided by him, the government’s source of funding for debt payment was:

• Pakistan Investment Bonds – Rs128 billion

• Expenditure savings – Rs135 billion

• Dividends recovered from Public Sector Enterprises – Rs20 billion

• Cash paid from Federal Consolidated Fund – Rs59 billion

• Recovery of payables to federal government from Public Sector     Enterprises – Rs138 billion

The government was also accused of printing new notes in order to pay off the debt in 45 days - a practise which increases inflation.

Dar said that the details of who received money as a result of circular debt payment can be found on the ministry’s website. “Our government believes in transparency and we have all the information put up online,” he said.