What’s behind Pakistan’s circular debt and why you should care
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- Опубліковано 21 вер 2024
- Currently, Pakistan’s circular debt stands at a whopping Rs1.4 trillion. Why should you Pakistani's care? Because you may end up paying for it. Watch our explainer to find out why.
#CircularDebt #PakistanEnergyCrisis #PakistanEconomy #Explainer
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More on Pakistan's circular debt ...
The menacing source of this burden is the relentless IOUs that keep piling up among the players in the energy sector supply chain. This includes power distributors, power producers, as well as oil and gas companies, such as PEPCO (Pakistan Electric Power Company), IPPs (Independent Power Producers), K-Electric, Pakistan State Oil and Southern Sui Gas.
The origin of debt seems simple: When you cannot afford to pay back what you owe, you incur a debt.
But what if it wasn’t your fault in the first place?
What if you couldn’t pay what you owed, because someone else couldn’t pay you?
This is the chain of IOUs that has dominated discussions on energy financing in Pakistan since 2007, which was around the time international oil prices went up.
As importing oil became more expensive, the government at the time did not pass on the price increase to the customers, leading to an imbalance between actual money owed to fuel companies, and money available to collect from the end consumers. The fact that a lot of energy was wasted during transmission (and still is), and a lot of people didn’t pay their bills (and still don’t), only compounded the problem.
Hence began the vicious cycle where the government and consumers didn’t pay the power-distribution companies, who couldn’t pay the power-generation companies, who couldn’t pay the fuel companies, who couldn’t buy more oil, leaving the government no choice but to borrow even more money, only for the cycle to repeat itself, with even greater numbers.
We did not get here overnight. Those in power have had many chances to address the issue since it became a serious threat in the late 2000s. In December 2009, this figure was eight times less than it is today at Rs90 billion.
Still confused? Watch this video to find out how we got to Rs1.4 trillion and why all Pakistanis should care about it.
For more explainers on Pakistan's economy visit vcast.online
Wonderful content.IA you gonna get reward for this one day for sure. Keep it up Sir👍🏻👍🏻👍🏻
It would have been an even greater effort without the baby-sounds, else it was really really comprehensive. Kudos.
Agree
🤣🤣
Kya baat hai...very nice video
everything is perfect, from animation to content. Thank you
wonderful WORK. You must keep this trend.
AMAZING! Keep it up champ
very good, short and precise
Well nice, sound quality was bit poor, yet nice and comprehend content. Keep it up brother.
fantastic . . .
Amazing explanation
Hi ....RGS...Here....
Excellent explaination
Damm very professional Thanks
Lol
🤣🤣🤣
Pakistan 🇵🇰 is whole under debt😂
How bout india. Each and every country on the planet except some countries are under debt.
@@Batman_akzo India's debt to GDP ratio is not that bad...yours is terrible
@@divyankdeshmukh bro stop being delusional
You sir just got a subscriber, thank you.
thankuu
Shouldn't it be 650 Billion Rupees at 2:06.
10% lost due to decrease in price from 10 Rs to 9 Rs.
15% lost due to line losses.
10% lost because people don't pay their bills.
Makes it a total of 35%.
And 35% of 1 trillion is 650 billion.
👍 nice
Hope the problem has been solved now by your great PM.
He's on it bro. Pray that this gets solved.
@@shaheryarkhan1652 Hahahahahaha.
Kamal period.
Simply advance your technology and find new renewable sources so that you wont have yo import oil in order to generate electricity.
Every ship for furnace oil purchase ...cost us 1billion approx Rs......corruption.......?????...in such situation how much our circular debt will rise in each year........???????Reference to Pakistan....
Good Remedy By PPP And PMLN To Generate Expensive Electricity And A Never Ending Circular Dept And Cycle Of Ever Increasing Bills To Tackle Load Shedding .
congo pakistan