Senate body recommends to resolve circular debt's issue

ISLAMABAD: Senate Standing Committee on Finance on Friday recommended that the issue of circular debt should be handled on priority.

The committee meeting chaired by Senator Nasreen Jaleel said that the energy crisis could be solved only by resolving the problem of circular debt as it was causing the hinderance in the growth of the country's economy.

Speaking in the committee's meeting, Secretary Planning Commission, Asif Bajwa said that the government had made serious efforts by starting the new projects of hydel, solar and wind energy and even some of them had added power the to national grid.

He informed the committee that the government was providing approximately Rs.1 billion subsidy per day on power sector because the 73 per cent of power was being generated from costly oil and furnace oil.

He stated that the power was generated at Rs12 per unit while it was sold Rs7.80 and the difference of Rs4.20 per unit was borne by the government in the form of subsidy.

"An amount of Rs1.12 trillion was also given as subsidy on the power sector since last four years", he said, adding "The government has also signed an agreement with Iran for import of 1000 megawatt (MW) of electricity.

The committee was also informed that under the old agreement signed with Iran, Pakistan was getting nearly 200 MW of electricity and of total, 100 MW was shifted to Gawader while 27 MW for Turbat in Balochistan.

The committee gave the recommendations that the funds for the development of Vashu in Balochistan should be allocated.

"The subsidy on tubewells in Balochistan should be given", the committee recommended, adding, sales tax on the import of raw material for Steel Mills should not be imposed.

The committee gave the recommendation that  Rs3.3 billion funds should be allocated for Gawader-Ratodero.

"The interest on the loans of flood-hit people should be waived off to provide relief to flood affected areas," the committee recommended.

The committee was also briefed on salary distortion of the government's employees that of total, 73 per cent were drawing one salary while 23 per cent drawing 2 and 3 salaries.