World Bank concerned on power sector's soaring circular debt

The World Bank has expressed reservations in a statement as circular debt of Pakistan’s power sector keeps surging.

“Despite steep hike in power tariffs in the country, the circular debt of the power sector still increasing,” WB stated.

Circular debt of Pakistan’s power sector rapidly soared during the period of fiscal years from 2019 to 2021, while during the FY 2022 to 2024 the debt keeping increased but with relatively slower speed.

The power sector’s circular debt increased by 1128 billion rupees during years 2019 to 2021, while it enhanced by 113 billion rupees from 2022 to 2024 years.

Total volume of the power sector’s debt was Rs 2393 billion in fiscal year 2024, which was more than double than 1152 billion rupees in year 2018. Power sector’s circular debt increased to 1619 billion in 2019 and 2150 billion in Year 2020.

The debt was 2280 billion in 2021 and 2253 billion rupees in 2022 year. The volume of the country’s circular debt soared to 2310 billion in FY 2023.