ISLAMABAD - Islamabad Chamber of Commerce and Industry (ICCI) has expressed grave concern over fast rising power sector circular debt that has touched the alarming levels and urged the policy makers to tackle this problem for maintaining macro-economic stability of the country.

ICCI President Zafar Bakhtawari in a statement said that the Ministry of Finance and the Ministry of Water and Power should take urgent steps for making payments to cope with the fast deteriorating energy situation. He expressed grave concern over the rapidly swelling power sector circular debt that has touched an alarming level of Rs.872 billion which was stood at Rs.161.21billion in 2008 showing an increase of 442percent.

Bakhtawari said there was a need to evolve an altogether new policy to attract private sector investment in electricity generation to overcome the gap between the demand for electricity and the supply. He said the main reason for the growing electricity shortfall was not just the increase in demand but also the declining capacity to produce electricity because of its inconsistent policies.

He was of the view that circular debt has been caused by government entities like railway, PIA, Pakistan Steel Mill etc, including the provincial and federal government departments not paying their utility bills, resulting in the power companies being cash-strapped and unable to pay for the fuel for their generation plants.

ICCI President said that the ultimate solution to the ongoing energy crisis lied in the construction of small water reservoirs and dams as well as tapping the coal potential the country owned. He said that the country’s dependence on power generated through thermal sources is costing too much causing to face insurmountable challenges to remain competitive both in national and international markets.

Bakhtawari said that every passing day the country is sinking deeper and deeper into economic mire which needs an economic stimulus plan to get it back on track. He was of the view that if the economic managers fail to take immediate measures the power sector is likely to choke up due to heavy outstanding dues.

ICCI President said that the country would have no future unless effective management of power sector, curtailing thefts, initiating new hydroelectric projects and revisiting energy mix.