IMF raises concerns over uncontrolled circular debt

The circular debt in the energy sector has surged by a staggering amount of Rs150 billion, raising alarms about its potential impact on the country’s economy.

There are apprehensions that the circular debt could reach a daunting Rs2.5 trillion by the end of the current fiscal year.

The IMF had set a target to control the circular debt at Rs 2.31 trillion for the ongoing fiscal year, urging an increase in tariffs for power and gas.

For the next financial year, the IMF seeks to increase tariffs for power and gas; however, negotiations are ongoing with the IMF mission with the officials of the Ministry of Energy.