Pakistan’s power sector circular debt declined by a record Rs779.58 billion during the 2024-25 fiscal year, according to a report by the Auditor General.
The report said circular debt fell to Rs1.614 trillion at the end of FY2024-25, compared with Rs2.393 trillion a year earlier.
An audit covering more than Rs985.8 billion in public expenditure across 74 entities under the Power Division and the National Electric Power Regulatory Authority found that the sharp decline was not driven by structural reforms or improved sector performance.
According to the audit report, the reduction was largely achieved through off-budget government financial support and commercial borrowing.
Despite the significant decline in circular debt, the performance of electricity distribution companies remained weak.
The report said actual transmission and distribution losses at power distribution companies stood at 17.55% during FY2024-25.
