Circular debt stock stands at Rs1.8trn as of Feb 2026: PD
- Circular debt flow remains within the prescribed targets and is expected to be fully cleared by the end of the fiscal year
ISLAMABAD: Power Division has claimed that the stock of circular debt stood at Rs. 1,837 billion as of February 2026. The observed increase since June 2025 is temporary and primarily due to timing differences.
The circular debt flow remains within the prescribed targets and is expected to be fully cleared by the end of the fiscal year, in line with the Circular Debt Management Plan. Such seasonal or monthly fluctuations are routine and do not affect consumers.
A Power Division spokesperson further added that it was also important to note that DISCOs’ inefficiencies have shown marked improvement. During July 2025-February 2026, inefficiencies declined by Rs. 48 billion compared to the same period of the previous year, reflecting enhanced operational performance, strengthened governance, and improved financial discipline across the power sector.
READ MORE: Circular debt set to touch Rs1.9trn mark
The Spokesperson further clarified that the power sector budget remains unchanged at Rs. 893 billion, as previously approved by the Government, and no additional supplementary grant has been sanctioned. Targets for circular debt reduction, recovery, and T&D losses for June 2027 are currently under review and are not finalized.
Payments to all Independent Power Producers (IPPs), including those under CPEC, are made routinely from the central pool strictly in accordance with their respective entitlements, without any preferential treatment. In addition, the Government has formulated a comprehensive Circular Debt Settlement Plan, aimed at eliminating circular debt over the next six years without any increase in electricity tariffs.
The plan is underpinned by structural reforms designed to address the root causes of inefficiencies and ensure the long-term financial sustainability of the power sector.
On Monday when Business Recorder reporter sought circular debt figures, Power Division spokesperson did not share. Even on Tuesday, during the public hearing in NEPRA. CFO PPMC said that circular debt figures are not yet final.
Copyright Business Recorder, 2026
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