Pakistan's total loans stand at over $ 63bn: NA told

ISLAMABAD: Minister for Textiles Makhdoom Shahabuddin on Monday apprised the National Assembly that Pakistan's total outstanding loans stood at over $63 billion.

Replying to various supplementary questions during Question Hour, he said that the government borrowed loans (domestic and foreign) and would pay interest on it.

He said that the government borrowed Rs.538.3 billion from national banks / institutions during the period from October 1 to December 31, 2011. Out of this amount, public debt instruments worth Rs.391 billion were issued as part of exercise of consolidation of outstanding power sector debt as well as the pending unpaid subsidy on commodity operations in November, 2011, he added.

He said that payable amount of interest on domestic loans was Rs.67.3 billion. Answering another question, the minister said that National Saving Schemes (NSS) offered competitive and attractive rates on various schemes especially for Pensioners Benefits Account and Behbood Savings Certificates.

He said that there were around 375 National Saving Centres across the country and these were being computerized to provide quality and prompt services to the public.

He said that a new prize bond of Rs.25,000 denomination had also been introduced on February 1, 2012. In response to another question, the minister said that indeed circular debt was a issue and efforts were being made to control it.      He said that the government gave subsidy to reduce burden on consumers. He said that line losses was a major reason for accumulating circular debt.

The minister said that receivables stood at Rs.888,969 million against payables of Rs.620,169 million on February 7, 2012. He said that partial transfer of tariffs, non recovery of dues of electricity bills from provincial/federal government departments, heavy line losses and dependence on expensive thermal generation due to decreased hydel power.

He said that the government took various measures to control the circular debt. The Finance Division released Rs.65 billion to PEPCO as soft term lo overcome to operational shortfall and to make necessary payments for the purchase of oil.

The Ministry of Water and Power with the approval of the Prime Minister released Rs.120 billion to PEPCO to clear arrears of tariff differential of all subsides upto June 30, 2011.

In addition Rs.11 billion has also been released to PEPCO by the Ministry of Water and Power through supplementary grant, he added. He said that the Finance Ministry has released Rs.391,018 million to PEPCO/KESC on account of tariff differentials subsidy during the fiscal year 2011-12 which includes Rs.312,768 million for settlement of power sector debt.

In response to anther question, the minister said that the National Logistic Cell is regularly filing monthly sales tax returns while the Frontier Works Organization is exempted from levy of tax under section 49 of Income Tax Ordinance, 2001.

Copyright APP (Associated Press of Pakistan), 2012