ECC to take up circular debt, impact on power sector in first meeting

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ISLAMABAD: The Economic Coordination Committee (ECC) of the cabinet will take up the matter of circular debt and its impact on the power sector on Tuesday.

Sources told this scribe that ECC in its first meeting under the chairmanship of Minister for Finance Asad Umer will take the briefing from the officials of Finance, Power and petroleum division on the circular debt and its impact on the power sector.

Presently, the circular debt stands around Rs1,168 billion which was Rs480 billion in 2013.

Power Holding Private Limited (PHPL) had borrowed Rs582.86 billion whereas Rs566 billion was borrowed to cover receivables of power distribution companies, furthermore on Monday the Sui Northern Gas pipeline limited (SNGPL) Managing Director informed the Senate Special committee on circular debt that SNGPL outstanding dues against the Water and Power Development Authority (WAPDA) are Rs5.5 billion, Rs7.6 billion industries, Rs80 billion K Electric, Rs55 billion Pakistan Steel Mills (PSM) and Rs 28 billion have to receive from the consumers.

The ECC is also to take up the matter of the shortage of Urea fertiliser as well as about the DAP for Kharif Crops for 2018.

Industry and production and ministry of National food security will inform the forum about the latest situation of urea fertilizer and DAP for Kharif Corps 2018.

Sources told that about 2,982 thousand tonnes of urea would be available during Kharif 2018 which includes 316 thousand tonnes of opening inventory and 2,666 thousand tonnes of domestic production.

In addition, the estimated offtake of urea would be about 2,912 thousand tonnes, leaving a balance stock of 69 thousand tonnes of urea for coming Rabi 2018-19.

Kharif 2018 began with 190 thousand tonnes of opening inventory of DAP. Meanwhile domestic production is estimated around 377 thousand tonnes, while imported supplies are around 823 thousand tonnes. Thus 1390 thousand tonnes of DAP would be available in Kharif 2018 against estimated offtake of 873 thousand tonnes.

The ECC will also make a deliberation on Pakistan State Oil (PSO) financial health and liquidity position and gas pricing.

The matter of gas pricing was also discussed on Monday in a special committee of Senate.

SNGPL MD briefed that the government had not increased the prices of gas for the last five years.

“We are purchasing gas at Rs629MMBTU whereas selling it at Rs399 MMBTU so we have a deficit of Rs230 MMBTU, he informed the committee.

Member Finance OGRA told that we had asked the caretaker government to increase the prices but they left the decision on new government so now PTI government has to take a decision.

Chairman Committee stated that our government will keep things in order. People do not pay the gas and electricity dues owing to the high percentage of taxes.

It is pertinent to mention here that Prime Minister Imran Khan on Monday appointed Asad Umer as chairman of ECC along with the other 13 members.