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The Oil and Gas Development Company Limited (OGDCL) has received another Rs7.73 billion instalment from Power Holding (Private) Limited (PHL), marking continued progress in the government’s plan to reduce Pakistan’s circular debt burden in the energy sector.
Pakistan’s circular debt crisis a persistent challenge in the energy chain stems from delayed payments between power producers, distributors, and fuel suppliers. To address this, the government initiated a 12-month repayment plan to clear Rs82 billion in principal and Rs92 billion in interest owed to OGDCL. The instalment program began in July 2025 following a mechanism approved by the federal government.
In a filing to the Pakistan Stock Exchange (PSX), OGDCL confirmed:
“As part of the circular debt settlement plan, OGDCL has received Rs7.725 billion as interest payment from Power Holding (Private) Limited, pursuant to the Government of Pakistan’s approved mechanism.”
This payment represents the latest in a series of twelve equal monthly instalments. A similar payment was made in August 2025, while the principal amount of Rs82 billion had already been cleared by the government in June 2024.
Analysts believe the steady repayment schedule signals improved fiscal discipline and a step toward stabilizing the energy sector. The government’s ongoing effort to curb circular debt which has historically exceeded Rs2.6 trillion is seen as crucial to restoring investor confidence and ensuring uninterrupted energy supply.
An energy sector analyst noted,
“Regular payments to OGDCL reflect the government’s commitment to resolving long-standing energy sector liabilities and improving liquidity across the chain.”
