Pakistan Plans to collect Rs278 Billion Debt Surcharge from Power Consumers as the federal government seeks to manage the growing circular debt in Pakistan. The Ministry of Finance reported that Rs156 billion will cover interest expenses, while Rs122 billion is earmarked for principal repayment. This plan aims to stabilize the energy sector financing and reduce the strain on state-owned energy companies.
Electricity consumers currently pay a debt service surcharge of Rs3.23 per unit. The surcharge is part of a broader debt repayment plan targeting both the power and gas sector circular debt. Analysts note that the Rs278 billion collection will support the fiscal year 2025-26 budget and help fund tariff adjustments.
The government is also considering a petroleum levy increase of Rs5 per litre. This step is intended to settle Rs1.7 trillion of gas sector circular debt over the next six years. By using additional levy collections, dividends from state-owned gas companies, and reducing imported LNG cargoes, the federal government hopes to bring long-term relief.
Experts warn that consumer electricity charges may rise temporarily, but these measures are necessary for energy sector stability. Non-recoveries, line losses, and taxes contribute significantly to the Rs3.18 trillion total gas sector debt. Proper implementation of the circular debt management plan could prevent future surcharges and ensure better financial management.
In conclusion, Pakistan’s Rs278 billion debt surcharge is a critical step to tackle circular debt in Pakistan’s power sector. By combining interest and principal payments, petroleum levy adjustments, and improved energy sector strategies, the government aims to strengthen financial sustainability and protect future consumers.
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Pakistan plans to collect Rs278 billion debt surcharge from power consumers to manage circular debt and stabilize electricity charges.
