Islamabad: The federal government has signed a 1.225 trillion rupees financing agreement with a consortium of eighteen banks to address the country’s power sector circular debt. A signing ceremony to this effect was held in Islamabad.

According to Radio Pakistan, Prime Minister Shehbaz Sharif, who witnessed the signing ceremony via video link from New York, termed the agreement a significant milestone in efforts to tackle the mounting issue of circular debt. He credited the relevant task force for fulfilling its responsibilities in an excellent manner.

The Prime Minister highlighted that the IMF Managing Director, during a meeting with him, was appreciative of reforms being carried out by the government. He stated that the next step is the privatization of DISCOs and addressing the challenge of line losses, emphasizing the need to move forward with confidence and firm resolve to register more successes.

In his remarks on the occasion, Finance Minister Muhammad Aurangzeb said this is the largest financing and largest restructuring transaction in the history of Pakistan. He mentioned that the financing facility will support in dealing with the issue of circular debt and emphasized that the benefit of structural reforms in the power sector will ultimately reach consumers.

Minister for Power Sardar Awais Leghari stated that the Circular Debt Financing Facility is a landmark initiative to restore the financial health of the power sector. He added that it will restore stability and provide relief to the consumers, noting that this is not an isolated measure but part of a broader reforms agenda of the government.