The Economic Coordination Committee today approved a substantial guarantee of Rs659 billion for Pakistan, a significant step aimed at managing the country’s ongoing circular debt within the power sector.

The approval for the sovereign backing, part of a broader 1.225 trillion rupee financing plan, was granted during a session chaired by Finance Minister Muhammad Aurangzeb.

This financial assurance is specifically intended to facilitate the settlement of Power Holding Limited”s outstanding debt and to clear overdue payments owed to Independent Power Producers.

The committee also reached a consensus on a framework for the rationalization of tariffs and payment adjustments concerning nuclear power plants, government-owned power facilities, OGDCL, and SNGPL.

In a separate decision, the ECC endorsed a phased, data-driven strategy to maintain stability in remittance inflows, seeking to avert any abrupt disruptions that could adversely impact the economy.