Banks refuse to lend PKR 50 billion to govt.

Commercial banks have refused to lend PKR 50Bn to slice down circular debt saying the govt. is only interested in debt servicing but not inclined to pay the principal amounts. The denial by the banks has further deteriorated liquidity crisis in the power sector as the circular debt with loan and liabilities has ballooned to PKR 1066Bn with just 85% recovery of the electricity bills which is why the power sector sustained the loss of PKR 185Bn. More importantly, documents also unveil that to cope with this kind of inefficiency and overcome the gap of PKR 85Bn loss in the head of theft alone, the overbilling of PKR 1-1.5Bn/month is extended to the legitimate consumers every month.