(Sept 25, 2020)
President Pakistan Businessmen and Intellectuals Forum and All Karachi Industrial Alliance, and former provincial minister Mian Zahid Hussain on Friday said circular debt has swelled to Rs2.1 trillion becoming a serious national security issue.
Circular debt is increasing by almost Rs550 billion per annum and it can jump to Rs5 trillion over the next four years, he said.
Mian Zahid Hussain warned that the infamous debt has the ability to hit the economy hard and bankrupt the ailing power sector.
Talking to the business community, the veteran business leader said that the policy of a continued increase in power tariff to make up for the losses has backfired which has damaged agriculture, industry, services sector and masses.
It is also hurting some important state-run institutions which are not in the loss despite political interference.
The business leader said that circular debt was increasing by Rs38 billion per month during the former regime while the minister of the incumbent government repeatedly claimed to bring it down to 10 to 12 billion rupees but in fact, it is swelling by Rs45 billion per month.
The current government is entering in its third year of rule and it is now difficult to blame the former government for everything while the consumers have a right to ask that if the power policy of the former government was flayed than why is it still being used.
The reasons behind circular debt are said to be flawed power purchasing agreements, theft, line losses, corruption, nepotism, non-payment of bills and undue political interference.
The government should make short-term and long term plan to address these issues as a country that is being run on borrowed money cannot afford weak policies and princely lifestyle of the elite.
