ISLAMABAD - The Finance Ministry on Wednesday said that government did not print notes to clear the circular debt worth of Rs 480 billion, as it generated amount from issuing Pakistan Investment Bonds, massive expenditures cut and other sources.
According to the details released by Finance Ministry, the government has settled the power sector circular debt in two phases, as in first phase Rs 342 billion were cleared on 28th June 2013.  The breakup of Rs 342 billion revealed that the government has issued Pakistan Investment Bonds worth of Rs 128 billion, Rs 135 billion was saved from cutting expenditures, Rs 20 billion from dividends recover from Public Sector Entities (PSEs) and Rs 59 billion was drawn from consolidated fund for clearing the circular debt.
Meanwhile, in the second phase, the government has cleared remaining Rs 138 billion on July 21 2013. Non-cash settlement of Rs 138 billion with PSEs, as Public Sector Entities owned Rs 134 billion to government. Therefore, the government has spent only Rs four billion.
Additional electricity of 1700 megawatt added into national grid following of clearing circular debt. To arrest re-emergence of circular debt, the government has budgeted Rs 220 billion subsidy for the current fiscal year 2013-14 wherein government has paid Rs 101 billion till today (July-December 18). The government has re-activated the institution of Federal Adjustor in consultation with provinces which will ease the situation.
In the first stage, the government has paid cash worth of Rs 161.23 billion to IPPs, issued Rs 56.32 billion Pakistan Investment Bond (PIB) to OGDCL (Oil and Gas Development Company Limited), and issued PIBs worth of Rs 23.36 billion to Pakistan Petroleum and Rs 81.33 billion to Pakistan State Oil (PSO). Meanwhile, in the second stage, the government completed a non-cash transaction of Rs138 billion through book adjustments to clear energy sector’s circular debt.
The break-up of payment made to IPPs revealed that government has paid Rs 75 billion to Hubco, Rs 41.354 billion to Kapco, Rs 6.98 billion to AES (Pakgen), Rs 4.55 billion to AES (Lalpir), Rs 3.5 billion to KEL, Rs 9.91 billion to Liberty (Gas), Rs 19.26 billion to UCH (Gas), Rs 8.69 billion to ROUSCH (Gas), Rs 5.1 billion to Fauji (Gas), Rs 2.54 billion to Habibullah (Gas), Rs 270 million to Altern (Gas), Rs 19.34 billion to AGL power (gas), Rs 17.40 billion the Hubco Narowal, Rs 5.4 billion to Atlas power.
Similarly, the government has paid Rs 7.08 billion to Nishat power, Rs 6.86 billion to Nishat Chunianin, Rs 1.31 billion to Liberty Tech, Rs 1.31 billion to Orient power (gas/HSD), Rs 4.9 billion to Saif Power, Rs 4.21 billion to Saphire Electric, Rs 2.52 billion to Halmore Power, Rs 8.97 billion to Engro power, Rs 7.07 billion to foundation power, Rs 1.16 billion to Shydo Power and Rs 105 million to Larib Energy.