Day: October 8, 2021

Minister for Energy, Hammad Azhar, said on Friday that the flow of circular debt from the energy sector has started decreasing.

The energy minister tweeted that the flow of circular debt in the power sector during July and August fell to Rs. 13 billion from Rs. 86 billion, a decrease of 84.77%, compared to the same period last year.

The energy sector’s circular debt is “a vicious cycle of unpaid bills in the power sector, starting from the power generation end of the process, and going all the way to the distribution process to recovery and electricity theft,” according to an article by Business Recorder.

The circular debt stood at Rs. 2,280 billion as of June 30, 2021, as compared to Rs. 2,150 billion as of June 30, 2020, and has reached Rs. 2.327 trillion as of August 31, 2021.

The country’s commercial banks have reportedly refused to finance power projects due to the energy sector’s circular debt.

A report recently published by the National Electric Power Regulatory Authority (NEPRA) highlighted some of the main issues plaguing the power sector.

In its “State of Industry Report 2020-21,” NEPRA said that a number of cost-efficient power plants are being underutilized.

The regulator added that distribution and high transmission losses, failure of payment of subsidies, and low recovery of the billed amount were some of the major reasons behind circular debt.

Some other reasons that contribute to the power sector’s circular debt include insufficient consumer tariffs that compensate for the rising costs of power generation, as well as challenges associated with the recovery of dues from consumers.

At the same time, the electricity generation cost per unit (kWh) has increased by up to 61.55 percent in August 2021 compared to August 2020.

Meanwhile, the federal cabinet has approved a seasonal electricity discount measure, through which it will provide a Rs. 7 per unit relief for electricity consumers that utilize the surplus electricity between November and February.

Source: Pro Pakistani

The remittances inflows from overseas Pakistanis to their homeland stood at a level of $2.7 billion in the month of September 2021, maintaining the strong momentum and support of the country’s economy.

Cumulatively, at $8.0 billion, remittances grew by 12.5 percent during the first quarter of the fiscal year 2021-2022 over the same period last year. This is one of the highest ever inflows of remittances recorded in a single quarter.

This is the seventh consecutive month in which the inflows were recorded at around $2.7 billion on average.

The inflows of remittances increased by 16.9 percent on a year-on-year basis in September and went up by 0.5 percent on a month-on-month basis according to the State Bank of Pakistan.

The remittance inflows in September were mainly sourced from Saudi Arabia ($691 million), the United Arab Emirates ($502 million), the United Kingdom ($370 million), and the United States ($245 million).

Proactive policy measures by the government and State Bank of Pakistan to incentivize the use of formal channels, curtailed cross-border travel in the face of the pandemic, altruistic transfers to Pakistan amid it, and orderly foreign exchange market conditions have positively contributed to the sustained improvement in remittance inflows since last year.

With $2.7 billion of inflows during September 2021, workers’ remittances continued their strong momentum and remained above $2 billion since June 2020.

The contribution of the remittances to maintain the balance of payment of the country is significant, particularly in the situation when Pakistan’s import bill continues to balloon, destabilizing the deficit of the current account.

Source: Pro Pakistani

Pakistan has submitted an action plan on human rights to the European Union for the Generalised Scheme of Preferences Plus (GSP+) review.

The country proposed an eight-point National Action Plan for Business and Human Rights (2021-26) at the GSP+ review currently underway in Brussels.

According to The Express Tribune, the plan is designed around 69 actions that deal with the implementation and strengthening of human rights legislation and financial transparency mechanisms.

The priority areas of the plan include financial transparency, corruption, and human rights standards in public procurement contracts; anti-discrimination, equal opportunity and inclusion; human rights due diligence; labour standards and the informal economy; child labour; forced or bonded labour; occupational health and safety; and access to remedy.

Sources said that the scheme, which will extend from 2016 to 2021, was approved in principle by the federal cabinet on 28 September.

The GSP plus is a trade program that removes or reduces import duties from products coming into the European Union (EU) from low-income countries.

In September, the EU proposed a new GSP scheme that ensured more scrutiny over whether countries are adhering to human rights and environmental conditions.

It introduced five new international conventions that countries under the GSP scheme will have to comply with. These address issues such as children’s rights, labor rights, and organized criminal activities.

The EU also added the possibility that it would withdraw GSP status for “serious and systematic violations” of its conventions.

The EU parliament passed a resolution a few months ago that raised concerns over Pakistan’s recent human rights violations, including blasphemy accusations and sectarian violence.

Pakistan’s current GSP plus status will stay in effect till December 2023 unless the EU approves an extension of the scheme.

Source: Pro Pakistani