The federal cabinet on Wednesday approved Pakistan’s largest-ever financial initiative to address the energy sector’s longstanding circular debt, marking a significant step toward economic stability.
Chaired by Prime Minister Shehbaz Sharif at the Prime Minister’s House, the cabinet meeting focused on critical decisions related to energy reforms, diplomatic engagements, and institutional appointments.
The approved financial scheme targets the resolution of Rs1,275 billion in circular debt over six years, aiming to stabilize the power sector without increasing the burden on the national budget. The plan includes refinancing Rs683 billion in liabilities of the Power Holding Company and settling overdue payments owed to Independent Power Producers (IPPs).
Calling it a “historic decision,” the Prime Minister said the move demonstrates the government’s resolve to implement structural reforms and reduce fiscal pressure while encouraging investment in the energy sector.
“This step ensures long-term sustainability and sends a strong signal of economic confidence,” he said.
The Prime Minister also praised Finance Minister Muhammad Aurangzeb and his team for presenting a budget that prioritizes public relief and economic recovery.
On the diplomatic front, PM Shehbaz lauded Chief of Army Staff Field Marshal Syed Asim Munir for effectively representing Pakistan during his recent visit to the United States. He commended the army chief’s strong message of commitment to national security and sovereignty.
The cabinet further recognized the efforts of Minister for Religious Affairs Sardar Yousaf for organizing a successful and well-coordinated Hajj operation this year, describing it as a reflection of efficient governance.
Other key approvals included the appointment of Kamal Uddin Tipu as Chairperson of the Commission for the Protection of Journalists and Media Professionals, recommended by the Ministry of Human Rights.
The cabinet also granted a special exemption under Section 21 of the Public Procurement Regulatory Authority Ordinance, 2002, to the National Power Parks Management Company Limited (NPPMCL) for procurement related to acquiring the Rousch Power Plant.
Additionally, the cabinet ratified decisions made during the Cabinet Committee on Legislative Cases meeting held on May 21, 2025.
