ISLAMABAD: The Pakistani government has informed the International Monetary Fund (IMF) that it will not pay interest of Rs220 billion on late payments to power plants being built under the China-led CPEC and will seek a formal waiver from Beijing in this regard. According to sources, the Energy Division briefed the IMF on the financial and operational situation of the power sector during the ongoing negotiations with the IMF. The government clarified that it recognizes only Rs250 billion as principal dues, while the amount due as interest of Rs220 billion is not being recognized. This amount is part of the total circular debt of Rs1.7 trillion. However, China has urged Pakistan in recent meetings to immediately establish a ‘circular account’ under the agreement made for CPEC energy projects so that timely payment of dues is possible. China and Pakistan agreed in the recent Joint Cooperation Committee (JCC) meeting that the tariffs of energy projects under CPEC will be maintained stable, disputes will be resolved through mutual consultation and no unilateral decisions will be taken by either party.

A spokesperson for the Energy Division declined to comment on the........

© The Patriot