Pakistan and the International Monetary Fund ended virtual talks without agreement on a plan to reduce the gas circular debt, estimated at PKR 3.3 trillion, officials familiar with the meeting said.
The proposed settlement sought to reduce the outstanding amount by about PKR 1.7 trillion. Officials’ reports said the IMF introduced additional accounting and recapitalisation conditions during the discussions.
Under the IMF proposal, gas companies would record unrecovered amounts as losses in their financial statements rather than continue treating them as receivables, according to the officials.
The companies would then require recapitalisation after recognising those losses. Officials said the accounting adjustment could also affect the share values of gas-sector companies.
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Petroleum Division officials were reluctant to accept the proposed conditions. No revised settlement framework was approved during the virtual meeting.
Pakistan and the IMF are expected to resume discussions in September. Officials said the government could prepare a revised proposal that incorporates some of the IMF’s recommendations.
The gas-sector liability forms part of Pakistan’s wider energy circular debt, which has accumulated through unpaid subsidies, delayed tariff adjustments, operational losses and weak recoveries.
