Islamabad:
The International Monetary Fund (IMF) asked Pakistan to submit a full plan to eliminate increasing circular debt.
According to sources, the circular debt of the gas sector has increased to 2,800 billion rupees, causing strong financial pressure on suit gas companies and other oil and gas entities managed by the state. In response, the government is working on a strategy to combat the crisis, which includes the guarantee of a loan of 2,000 billion rupees among banks in favorable terms.
Negotiations would be underway with banks to reduce or give up interest rates. The government also plans to impose an oil director from RS3 to RS10 per liter and an additional supplement to gas bills to collect funds for the reimbursement of the debt. Thanks to the oil levy offered alone, it plans to generate approximately RS180 billion.
The reimbursement of bank loans should extend over five years. Meanwhile, the government will also have to reduce the operational losses of gas companies to effectively resolve the issue of circular debt.
