The loan of Rs 1.25 trillion to 18 banks will be repaid through Debt Service Surcharge (DSS), and consumers will have to pay a surcharge of Rs 3.23 per unit for 6 years
Dawn Investigation Cell, Dawn TV Report
Islamabad: The government has signed loan agreements worth about Rs 1.25 trillion with 18 banks to eliminate the circular debt of the energy sector and pay private power plants (IPPs). These payments will be made by collecting a surcharge of Rs 3.23 per unit from consumers for the next 6 years.
The agreement was signed at the Prime Minister’s Office; the Prime Minister attended the ceremony virtually from New York.
Under the agreement, the government will have to request funds from banks within 30 days so that they can be used on time; otherwise, penalties may be imposed. After making the request, the government will have 3 months to withdraw the approved amount.
The total debt of Rs 1.225 trillion will be paid through Debt Service Surcharge (DSS), out of which Rs 659 billion will be spent on loans payable to Power Holding Limited, and the remaining amount will be used for IPPs, petroleum sector companies and subsidy adjustments, which include book entries and cash payments.
The Ministry of Finance signed these agreements with 18 banks, including Habib Bank, Meezan Bank, National Bank of Pakistan, Allied Bank Limited, United Bank Limited, Faisal Bank, Bank Al Habib, MCB Bank, Bank Al Alfalah, Dubai Islamic Bank, Bank of Punjab, Bank Islami Pakistan, Askari Bank, Habib Metropolitan Bank, Al Baraka Bank, Bank of Khyber, MCB Islamic Bank and Soneri Bank.
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