Govt constitutes committee for settlement of gas sector circular debt

ISLAMABAD: The federal government on Wednesday constituted a 10-member committee to settle the circular debt that has plagued the gas sector for years. The committee is to finalise a report within 10 days, according to a government notification.

The circular debt of the gas sector has surged to Rs 1,549 billion due to which the International Monetary Fund (IMF) has asked Pakistan to increase the gas tariff for consumers to recover portions of the debt.  

According to the notification, the finance minister formed the committee that will convene under Ashfaq Tola.  

Other members of committee include Secretary/Additional Secretary (Petroleum Division), Secretary/Additional Secretary (Power Division), Additional Secretary CF Finance Division, Commissioner SECP Abdul Rehman Warriach, Chief Financial Officers of Pakistan Development Fund (PDF), Oil & Gas Development Limited (OGDCL), Government Holding Pvt. Limited (GHPL), Pakistan State Oil (PSO), Pakistan Petroleum Limited (PPL), Sui Northern Gas Pipeline Limited (SNGPL), Sui Southern Gas Company Limited (SSGCL) and Central Power Purchase Authority (CPPA-G).

The Terms of Reference (TORs) of the committee include undertaking a detailed mapping of the gas sector circular debt stock as of June 30, 2022, segregating principal amount of debt, surcharges and penalties.

The other TORs of the committee are to work out a comprehensive circular debt settlement plan through cash/non-cash release adjustments and to identify legal and procedural requirements to implement the settlement plan. 

The committee may co-opt any other member and the finance division will provide secretarial support.