Govt finalizes modalities, framework to reduce circular debt in gas sector

August 04, 2023 (MLN): In a major breakthrough, the government has finalized a comprehensive modalities and framework aiming at fostering sustainability in the country's energy sector and reducing the circular debt in the gas sector.

The said development was discussed on Friday during the meeting of regulatory reforms in the energy sector under the chairmanship of the Finance Minister Senator Mohammad Ishaq Dar, said a press release issued by Finance Division today.

The Finance Minister reiterated the priority of the government to address the issues of the energy sector to improve the macroeconomic indicators of Pakistan and to enhance the economic growth of the country, it added.

In a bid to unlock the IMF deal, the government has already initiated the process of reducing the circular debt of the gas sector and for this, the Ministry of Finance approved Rs415 billion to bring down gas circular debt which stood at Rs1600bn, according to the media reports. 

Earlier in May 2023, Ishaq Dar directed the Auditor General of Pakistan (AGP) to verify the gas circular debt claims of Sui Northern Gas Pipeline Limited (SNGPL) and Sui Southern Gas Company (SSGC) on the subject of gas development surcharge (GDS) which would help to settle Rs700bn receivables.

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