ISLAMABAD - First meeting of newly constituted Economic Coordination Committee (ECC) of the Cabinet would meet Wednesday (today) to discuss five points' agenda including issue of circular debt and its impacts on power sector.

Finance Minister Asad Umar would chair the meeting of ECC, a top economic decisions making body of the country. The meeting would discuss the issues including liabilities of the Pakistan State Oil (PSO), gas pricing, measures to address shortage of urea fertiliSer and DAP for Kharif crop-2018. The ECC would discuss of rising circular debt in power sector. The power sector's consolidated payables had currently reached to Rs 1.15 trillion of which Rs582.86 billion are loans parked in the books of Power Holding (Private) Limited (PHPL) whereas Rs566 billion is circular debt. The meeting would consider measures to eliminate the mounting circular debt.

The top economic decisions making body of the country would also consider increasing the consumer gas prices. The two state-owned natural gas companies SNGPL and SSGCL have recently said that they are losing money due to huge difference in the gas purchase and sale prices which is increasing the circular debt and demanded of the government to increase the gas prices to resolve the issue. Oil and Gas Regulatory Authority (OGRA) had recommended increasing gas prices to the caretaker government but they refused and is now urging the PTI government to implement its recommendations.

SNGPL's payables as of stood at Rs 171.072 billion including mark up of Rs28.873 billion whereas receivables were Rs 165.015 billion. Of this amount Rs10.442 billion against Wapda and IPP's relates to RLNG. SSGCL's receivables stood at Rs203.567 billion of which Rs 83.467 billion are against Karachi Electric (KE), Rs 55 billion PSM, Rs 13.995 billion SNGLP (uniform price), SNGPL (net) Rs 3.905 billion, Wapda (JPCL/CPGCL) Rs3.532 billion, sales tax recoverable Rs 25.243 billion, and income tax recoverable Rs18.424 billion. SSGCL's payables of OGDCL stood at Rs69.827 billion, PPL Rs 43.363 billion, and GHPL Rs 35.590 billion, totalling it to Rs148.780 billion.

The gas utilities asked the government to pass on the impact of higher gas costs to consumers to dissolve the circular debt of around Rs123 billion that had caused a serious cash flow problem. The ECC in its meeting would consider the request of gas companies to increase the gas prices. Meanwhile, the meeting would take the issue of including liabilities of the PSO. Pakistan State Oil (PSO) has recently sought Rs65 billion from Power Division to release its choked credit line and ensure furnace oil supplies to the power sector.