ICCI for urgent solution of circular debt to save industry

  • March 11, 2010
Islamabad Chamber of Commerce and Industry (ICCI) has shown great concerns over rising inter-corporate circular debt which has reportedly swelled to Rs.108-billion and called upon the government to take urgent measures to resolve this issue once for all as rising circular debt is becoming a big threat for manufacturing and industrial activities.

Zahid Maqbool, President, ICCI said that any interruption in fuel supply due to circular debt will cause prolonged power breakdowns in the country which will send the whole industrial sector into deep trouble, therefore, government should give high priority to resolving this issue so that country’s productivity may not suffer.

He said that due to circular debt issue, power and oil sectors are in critical situation, but it seems that government has not devised any immediate plan to bail out these sectors by releasing their payments.

He stressed that government should immediately release funds to electric power companies so that they could clear the debt of oil supplying companies that are facing serious financial problems on account of non-payment of their outstanding dues.

ICCI President said that the whole issue of circular-debt has been in the making for years with no visible remedial measures from the government side. He said it is high time that government should develop a comprehensive mechanism to ensure smooth payments to electric and oil companies which will save the country from more serious power crisis.

He said that the poor recoveries by electric power companies have emerged as the main reason of the circular debt and steps should be taken to improve this area to avoid surging circular debt problem.