ISLAMABAD — Pakistan’s circular debt in the power sector surged by Rs79 billion during the first quarter of the fiscal year, reaching Rs1.693 trillion by the end of September 2025, according to a report issued by the Power Division.
The report highlighted that the debt had stood at Rs1.614 trillion in June 2025, marking a steady increase over the three-month period. Despite this quarterly rise, the figure still reflects a substantial year-on-year improvement, as the circular debt was recorded at Rs2.467 trillion in September 2024 — a drop of Rs774 billion over the year.
Read More: Power sector circular debt rises by Rs79bn
Energy analysts attributed the recent uptick to delayed payments, electricity theft, and inefficiencies within the power generation and distribution system. They warned that unless these systemic issues are addressed, the debt burden could continue to grow.
The government, however, remains optimistic. Officials said ongoing reforms, enhanced recovery drives, and anti-theft measures are expected to help reduce the circular debt in the coming months. They added that maintaining fiscal discipline in the energy chain remains a top policy priority.