The energy crisis in Pakistan has reached alarming proportions, with circular debt ballooning to an estimated Rs7.5 trillion (approximately $27 billion USD) by the end of 2025. This staggering figure, reported by the State Bank of Pakistan, reflects decades of policy stagnation and inefficiencies in generation, transmission, and distribution. The economic fallout includes an annual loss of 2-3% of GDP due to energy shortages, severely affecting both industrial output and the daily lives of citizens through rising costs and power outages.
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Pakistan's Energy Crisis: Circular Debt Hits Rs7.5 Trillion
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Pakistan's energy sector faces a critical crisis with circular debt soaring to Rs7.5 trillion ($27 billion) by end-2025, exacerbated by inefficiencies and a lack of reforms. The new Off-grid Levy Act 2025 will further strain industrial costs, impacting over 240 million citizens.
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