Circular debt flow declined by Rs 408b in 2020-21
Pakistan has informed World Bank that the flow of circular debt in the energy sector declined by Rs 408 billion in the financial year 2020-21.
However, circular debt continued plaguing the entire energy sector. An amount of Rs 130 billion was added to the circular debt in the energy sector during the year.
Vice President for South Asia, Mr. Hartwig Schfer led A World Bank delegation led who called on Federal Minister for Energy Mr. Muhammad Hammad Azhar here on Wednesday.
Special Assistant to the Prime Minister on Power and Petroleum, Mr. Tabish Gauhar, Secretaries of Power and Petroleum Divisions, Pakistan Executive Director at World Bank, Mr. Naveed Kamran Baloch, Country Director Pakistan Mr. Najy Benhssine, and other senior officials attended the meeting.
During the meeting, both matters discussed the matters related to World Bank-funded ongoing projects in the energy sector.
The Minister for Energy informed the delegation that due to effective measures the Government took, the country has curtailed the growth in circular debt to a considerable amount.
He said that during the last fiscal year i.e 2020-21, the country added Rs. 130 billion in the circular debt registering a decline of Rs. 408 billion in the circular debt flow as compared to the previous year.
He informed the delegation that this summer, Pakistan has registered around a 20% increase in peak demand for electricity which is a good omen for the energy sector and the economy.
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The Minister for Energy informed the delegation that Power Division has planned the addition of considerable capacity in the existing transmission network by the end of the current fiscal year for which funds have also been allocated.
He underscored the importance of World Bank assistance in the expansion and modernization of Pakistan’s Electricity Transmission System
The Vice President World Bank while acknowledging efforts by the Ministry of Energy in slowing the growth of circular debt, renewed the commitment of the World Bank to continue working with Government in the Energy Sector.
He said that Pakistan has the potential of achieving a growth rate of 6 to 7%. He also stressed upon closer working between the expert group of the Ministry of Energy and the World Bank for the achievement of targets.
