IMF Scorecard: Losses Galore

The International Monetary Fund (IMF) in a review of the Structural Reforms Programme under the recently concluded EFF for Pakistan, has concluded that the total losses incurred by the three major Public Sector Enterprises (PSEs) and the power sector companies debt (circular debt) has risen to a level of Rs.1.365 Trillion, which is higher than the consolidated Annual Development Programme of Rs.1.25 Trillion in the current fiscal year. It was a stipulated condition of the three-year economic reforms programme to revive the loss-making PSEs and make them viable entities – and as on many other economic and financial fronts, the government seems to have fallen short.

• The losses by the three PSEs - Pakistan International Airlines (PIA), Pakistan Steel Mills (PSM) and Pakistan railways (PR) - have reached a level of Rs.705 Billion in the past three years.
• The debt for the power sector companies (circular debt) has risen to a level of Rs.660 Billion, with Rs.348 Billion accumulated in the past three years, despite the massive payout by the government to settle the issue in 2013 and the repeated increases in consumer tariffs.
• In addition to the Rs. 1.365 Trillion, is the ‘rising’ circular debt’ in the import of Re-gasified Liquefied Natural Gas (RLNG), which currently stands at Rs. 12 Billion. (In the current fiscal year Rs. 20 Billion is earmarked for the Millennium Development Goals and Community Development Programmes).

Read Full Article: IMF Scorecard: Losses Galore