A Spokesperson of the Power Division in a rebuttal to a news item titled “Power ministry seeks Rs400bn to meet IMF condition” published in Daily News on 21 December 2024, said that the news item is not based on factual data and misleading. The Spokesperson said that the news item has concocted a routine Inter-ministerial correspondence as an SOS call letter issued by Power Division. Regular communication as per the budget strategy paper is shared with the finance Division for keeping track of releases and expenditures. The Finance Division seeks such information as part of the cash flow strategy however, the author tried to link subsidies with the IMF target. The target agreed with the IMF is for managing the circular debt within certain limits during each quarter and the power sector is well within limit. The Spokesperson said that Power Division regularly gets releases as and when due and during the first quarter of Jul-sept 2024 Power sector got Rs 128 billion in subsidies released. During 2nd quarter Rs 31 billion, have already been released and more than 50 billion are in the pipeline. With the improved performance of loss and recovery, it is expected that the Power division will safely remain within the target set for the end of December 2024. Regarding Circular Debt targets the Spokesperson added that the Power Division is working on various benchmarks agreed with the IMF, and the program is on track. IMF target relates to meeting circular debt target for each quarter and the power sector is performing well within the target agreed. The News item has alluded to the quarterly circular debt target agreed upon with the IMF and has linked the compliance of targets with subsidy releases only which is misleading as the Circular Debt Management includes many other factors besides the subsidies. The Spokesperson said that as per the agreed target with the IMF, the Power sector is required to maintain a circular debt addition of less than Rs 461 billion by the end of December 2024. In this regard, it is clarified that, as of 19th December 2024 CD flow has reached only Rs 70 billion which is well below the target agreed for the end of December 2024. This is much less than the target agreed and it is expected that the achievement of the target is very much in control.
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