NHA tops SOE losses with around Rs2tr accumulated deficit

July 14, 2025 (MLN): The National Highway Authority (NHA) recorded the largest loss among State-Owned Enterprises (SOEs) during the first half of FY2025, with a staggering Rs153.3 billion loss that pushed its accumulated losses to Rs1.95 trillion.

The dismal figures reflect the unsustainable toll-revenue model against the backdrop of massive road infrastructure expansion, according to the biannual report on federal state-owned enterprises (SOEs).

In total, major loss-making SOEs posted a combined net loss of Rs343bn during the period, highlighting deep financial deficits across sectors.

Quetta Electric Supply Company (QESCO) and Sukkur Electric Power Company (SEPCO) followed with losses of Rs58.1bn and Rs29.6bn, respectively.

QESCO's accumulated losses stood at Rs770.6bn, while SEPCO’s reached Rs473bn underscoring chronic inefficiencies and poor recoveries in the distribution segment.

Pakistan Railways added to the burden with a Rs26.5bn loss and accumulated shortfall of Rs6.7bn.

Peshawar Electric Supply Company (PESCO) posted a Rs19.7bn loss, raising its total deficit to Rs684.9bn.

Pakistan Steel Mills (PSM) reported a Rs15.6bn loss, increasing its accumulated losses to Rs255.8bn.

Further losses came from Pakistan Telecommunication Company Limited (PTCL), which posted Rs7.2bn (accumulated: Rs43.6bn), Pakistan Post with Rs6.3bn (Rs93.1bn accumulated), and Utility Stores Corporation reporting Rs4.1bn in losses (Rs15.5bn accumulated).

Among power generation companies, the GENCOs (I-IV) collectively posted losses exceeding Rs8.3bn, GENCO-II (Guddu) led with Rs3.8bn, followed by GENCO-III (Muzaffargarh) at Rs3.1bn, and GENCO-I (Jamshoro) at Rs1.3bn.

Neelum Jhelum Hydro Power Company contributed another Rs2.3bn in losses, with an accumulated total of Rs58.2bn.

The category of “All Other” loss-making SOEs added Rs2.7bn to the fiscal burden, with cumulative losses of Rs1.28tr.

Altogether, the total accumulated losses of these over 15 entities reached Rs5.89tr,underscoring deep-rooted inefficiencies and the urgent need for turnaround strategies.

The financial picture of Pakistan’s power distribution companies (DISCOs) paints an even grimmer scenario.

Over the six-month period, their total core operating loss stood at Rs283.7bn after adjusting for government subsidies.

QESCO led with Rs92.65bn in losses, followed by PESCO at Rs53.68bn and Hyderabad Electric Supply Company at Rs39.63bn.

Even DISCOs that showed positive EBIT before subsidy adjustments, such as Multan (EBIT Rs8.4bn), Faisalabad (Rs52bn), and Gujranwala (Rs20.9bn), slipped into losses after subsidy removal, recording net losses of Rs35.17bn, Rs13.12bn, and Rs7.32bn, respectively.

Other DISCOs including Lahore, Islamabad, Sukkur, and Tribal regions also failed to remain profitable post-adjustments.

Quetta DISCO’s situation appeared particularly severe, with an EBIT loss of Rs60.36bn and additional subsidies of Rs32.3bn still resulting in a massive net loss.

Adding to the fiscal stress is a persistent 20% technical and commercial loss in electricity units, driven by inefficiencies in billing, recovery, and transmission systems.

This structural flaw pushed the 6-month average sectoral loss near Rs300bn, which extrapolates to Rs600bn annually.

The scale of these losses signals a critical need for transformational reforms, including improvements in governance, technological upgrades, privatization or concession models, and tariff realignments.

Without these measures, the ongoing fiscal hemorrhage risks paralyzing both the national exchequer and the broader energy sector recovery.

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