Govt admits passing circular debt interest on to public under IMF pressure
Business
The meeting was told the K-Electric was producing expensive electricity.
ISLAMABAD (Dunya News) – The government admitted on Friday that it was passing the circular debt interest on to the public due to pressure from the IMF.
These remarks were made by energy secretary in National Assembly Standing Committee meeting. The secretary told the standing committee that due to the IMF pressure, they had to pass interest amount on the circular debts to the public in every case.
The secretary informed the committee, “They cannot allow the circular debt to increase, as the IMF is exerting significant pressure on them. He mentioned that the interest on the circular debt must be passed on to the public, and any payments to IPPs will also burden the public.”
He further stated that they could no longer remain complacent, and the entire burden must be placed on consumers. He mentioned that the issues raised by members regarding electricity rates are the same points they discuss with the IMF, but the IMF does not agree.
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In the meeting, it was revealed that K-Electric is producing expensive electricity.
The power secretary explained that all of K-Electric's electricity is generated from thermal sources. If the government does not provide a subsidy to K-Electric, the per-unit price could reach Rs 80.
He added that the CEO of K-Electric mentioned that if they generate electricity from LNG, the cost would be Rs 40 per unit, and as soon as gas prices decrease, the electricity prices will also drop.
