Pakistan fails to pay dues to Chinese power companies repeatedly, wants extension in debt repayments also
July 14, 2025
  • Read Ecopy
  • Circulation
  • Advertise
  • Careers
  • About Us
  • Contact Us
Organiser
  • ‌
  • Bharat
    • Assam
    • Bihar
    • Chhattisgarh
    • Jharkhand
    • Maharashtra
    • View All States
  • World
    • Asia
    • Europe
    • North America
    • South America
    • Africa
    • Australia
    • Global Commons
  • Editorial
  • International
  • Opinion
  • Op Sindoor
  • More
    • Analysis
    • Sports
    • Defence
    • RSS in News
    • Politics
    • Business
    • Economy
    • Culture
    • Special Report
    • Sci & Tech
    • Entertainment
    • G20
    • Azadi Ka Amrit Mahotsav
    • Vocal4Local
    • Web Stories
    • Education
    • Employment
    • Books
    • Interviews
    • Travel
    • Law
    • Health
    • Obituary
    • Podcast
MAGAZINE
  • ‌
  • Bharat
    • Assam
    • Bihar
    • Chhattisgarh
    • Jharkhand
    • Maharashtra
    • View All States
  • World
    • Asia
    • Europe
    • North America
    • South America
    • Africa
    • Australia
    • Global Commons
  • Editorial
  • International
  • Opinion
  • Op Sindoor
  • More
    • Analysis
    • Sports
    • Defence
    • RSS in News
    • Politics
    • Business
    • Economy
    • Culture
    • Special Report
    • Sci & Tech
    • Entertainment
    • G20
    • Azadi Ka Amrit Mahotsav
    • Vocal4Local
    • Web Stories
    • Education
    • Employment
    • Books
    • Interviews
    • Travel
    • Law
    • Health
    • Obituary
    • Podcast
Organiser
  • Home
  • Bharat
  • World
  • Operation Sindoor
  • Editorial
  • Analysis
  • Opinion
  • Culture
  • Defence
  • International Edition
  • RSS in News
  • Magazine
  • Read Ecopy
Home International Edition News

Pakistan fails to pay dues to Chinese power companies repeatedly, wants extension in debt repayments also

About a decade ago, many Chinese Independent Power Producers (IPPs) had finalised Power Purchase Agreements (PPAs) with the Pakistan government. Non-payment of their dues for power purchased as also debt repayments of $17 billion have become a serious concern now with no solution in sight

by Sant Kumar Sharma
Jul 30, 2024, 06:00 pm IST
in News, South Asia, Asia, International Edition
Pakistan fails to clear dues of China

Pakistan fails to clear dues of China

FacebookTwitterWhatsAppTelegramEmail

The Pakistan Federal government has put in a formal request with China to various loans amounting to almost $17 billion on account of investments in the power sector. For the past few months, top Pakistan leaders, including Prime Minister Shehbaz Sharif, have repeatedly visited China but failed to convince the Chinese leadership on this count. Federal Finance Minister Mohammad Aurangzeb is in Beijing at present for pleading Pakistan’s case with Chinese lenders as also leaders again.

Representatives of Chinese companies have said that the matter of whether to restructuring the energy debt should be decided between the Chinese banks and the Pakistani authorities. They also ruled out the possibility of renegotiating their own terms and conditions regarding the power purchase agreements (PPAs) signed years ago in 2015, according to reports in The Express Tribune.

High power bills are a major source of unrest among public all over the country and the Pakistan government apparently wants to bring down tariffs. Accordingly, it has prepared a proposal for extension in energy debt repayments to China. The extension sought for repayments is eight years in case of most loans which were taken to execute China Pakistan Economic Corridor (CPEC) projects. Presently, the loan repayment period is 10 years in most cases but the Pakistan government wants that the loans be returned in 15 to 18 years.

If accepted by the Chinese authorities, the cumulative impact of these concessions could be around Rs 6 to Rs 7 per unit reduction in the prices. The impact of just the Chinese power plants is Rs 3 to Rs 4 per unit, according to the Finance Ministry.

Finance Minister Aurangzeb and Energy Minister Sardar Awais Laghari met with China’s finance minister and the President of China Export and Credit Insurance Corp (SINOSURE) to discuss the issue. SINOSURE had insured the loans Chinese companies took from Chinese banks to set up projects in Pakistan.

Besides requesting extension for repaying energy debts, the Pakistan delegation also wants to convert US dollar-based interest payments to Chinese currency. It also wants reduction in  overall interest rates for both CPEC and non-CPEC Chinese-funded projects, according to ministry officials.

The officials did not say anything on whether China has agreed to extend the loans or reduce the interest rates. Incidentally, Pakistan has repeatedly breached CPEC agreements by failing to make timely payments for power purchased from the Chinese plants. This has made SINOSURE hesitant to fund a new coal-fired power plant and two hydroelectric plants.

The main reason for the surge is the Power Division’s failure to settle at least 90 per cent of the monthly claims from these Chinese power projects as mutually agreed. Under the agreement, Pakistan was to create a revolving fund with 21 per cent of the power invoices to protect Chinese firms from the circular debt crisis. Instead, it wants to now pass on the burden and effects of its own mismanagement of the power sector to the Chinese power companies.

On behalf of the Chinese power companies, the Chinese government has repeatedly raised the issue of pending payments with Pakistan through diplomatic channels. Earlier this week, the Chinese companies expressed opposition to any plans to reduce their profit margins. Presently, at least of 21 Independent Power Projects (IPPs) are going on in Pakistan under the CPEC, including eight projects of coal, four projects of hydel power, eight of wind power and one transmission line.

The non-payment of dues to the Chinese power companies may impact many ongoing power projects also as they may get delayed beyond anticipated dates. Three of the hydel power projects likely to be impacted are the 720 Karot Hydropower Project located 74 km upstream of Mangala dam, 700 MW Azad Pattan Hydropower Project and the 1,124 MW (281×4) Kohala project, all three on the Jhelum river.

Topics: Power Purchasing AgreementsIndependent Power ProjectsPakistanChinaCPEC
Share1TweetSendShareSend
✮ Subscribe Organiser YouTube Channel. ✮
✮ Join Organiser's WhatsApp channel for Nationalist views beyond the news. ✮
Previous News

Laos becomes first country globally to release postage stamp featuring Bhagwan Ram Lalla

Next News

Telangana: Court upholds rights of Shia women from Akhbari sect to conduct religious prayers in Ibadat Khana

Related News

Digital India Foundation flags security threat over Pakistan bid to join global AI Alliance Network (AIANET)

Digital India Foundation flags security threat over Pakistan bid to join global AI Alliance Network (AIANET)

Trump slams Afghanistan exit as ‘most embarrassing moment’ in US history

Trump slams Afghanistan exit as ‘most embarrassing moment’ in US history

Baloch Liberation Front claims responsibility for 17 attacks under 'Operation Baam' on Pakistani military facilities

Baloch Liberation Front claims responsibility for 17 attacks under ‘Operation Baam’ on Pakistani military facilities

Tibetan Spiritual leader Dalai Lama

Succession plan of the Dalai Lama and its impact on India

“Our border is with Tibet, not China”: Arunachal CM Pema Khandu strikes at heart of Beijing lies

Pakistan SC acquits 72-year-old Christian Anwar Kenneth after 23 years on false blasphemy charges

Pakistan: After 23 years of detention, Supreme Court acquits 72-year-old Christian Catholic man accused of blasphemy

Load More

Comments

The comments posted here/below/in the given space are not on behalf of Organiser. The person posting the comment will be in sole ownership of its responsibility. According to the central government's IT rules, obscene or offensive statement made against a person, religion, community or nation is a punishable offense, and legal action would be taken against people who indulge in such activities.

Latest News

Representative image

UPI Revolution in India: IMF hails digital payment system as it surpasses Visa with 650 million daily transactions

India’s First Undersea Bullet Train Tunnel Breakthrough Completed in Mumbai

Bharat on Fast Track: Modi govt achieve first undersea bullet train tunnel in Mumbai with Japanese tech giant

Representative image

Indian Railways to install CCTV cameras in all 74,000 coaches and 15,000 locomotives to strengthen passenger safety

Punjab: 4 men posing as Nihangs, including a gurdwara granthi arrested within 10 hrs for abducting & looting a woman

Representative Image

Ramayana Diplomacy? Pakistan uses Hindu epic to soften global image after Ops Sindoor & Indus treaty fallout

Ejaz, man accused of using fake identity and forcing religious conversion (Left)

UP: VHP demands action against Ejaz for posing as Hindu Azad Singh to marry woman & forced her and daughter to convert

USA: FBI arrests 8 including India’s ‘MOST WANTED’ Khalistani terrorist Pavittar Batala; Assault rifles seized

Site of the Ahmedabad plane crash

Ahmedabad Flight Crash: Fuel switches replaced in 2019 and 2023, mystery deepens over who turned off fuel control

Dalit Hindu e-rickshaw driver named Ankit brutally attacked by Muslim mob for playing bhajans

Uttar Pradesh: Brutal assault on Dalit Hindu e-rickshaw driver in Moradabad for playing Shiv bhajan during Sawan

Operation Kalanemi: Crackdown by Uttarakhand government against fake religious leaders 

  • Privacy
  • Terms
  • Cookie Policy
  • Refund and Cancellation
  • Delivery and Shipping

© Bharat Prakashan (Delhi) Limited.
Tech-enabled by Ananthapuri Technologies

  • Home
  • Search Organiser
  • Bharat
    • Assam
    • Bihar
    • Chhattisgarh
    • Jharkhand
    • Maharashtra
    • View All States
  • World
    • Asia
    • Africa
    • North America
    • South America
    • Europe
    • Australia
    • Global Commons
  • Editorial
  • Operation Sindoor
  • Opinion
  • Analysis
  • Defence
  • Culture
  • Sports
  • Business
  • RSS in News
  • Entertainment
  • More ..
    • Sci & Tech
    • Vocal4Local
    • Special Report
    • Education
    • Employment
    • Books
    • Interviews
    • Travel
    • Health
    • Politics
    • Law
    • Economy
    • Obituary
    • Podcast
  • Subscribe Magazine
  • Read Ecopy
  • Advertise
  • Circulation
  • Careers
  • About Us
  • Contact Us
  • Policies & Terms
    • Privacy Policy
    • Cookie Policy
    • Refund and Cancellation
    • Terms of Use

© Bharat Prakashan (Delhi) Limited.
Tech-enabled by Ananthapuri Technologies