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KARACHI: Pakistan has announced the resolution of Rs1.225 trillion ($4.29 billion) in power sector circular debt, said an official statement on Thursday, a move officials described as a landmark step to restore stability in the country’s troubled energy market.

Federal Power Minister Sardar Awais Ahmed Khan Leghari, addressing a ceremony televised nationally, said the agreement was aimed at breaking the debt cycle that has long weighed on the sector.

“The circular debt has long burdened Pakistan’s energy sector,” he said. “Today, this circular debt scheme is a bold step to break that cycle, restore stability and provide relief to our consumers.”

He added that the restructuring was part of a broader reform plan rather than an isolated measure.

“Previously, only the financial cost of the debt was being serviced, a stopgap that never addressed the real issue,” he added. “Now, a burden of Rs1,225 billion in circular debt is going to be settled without falling on the exchequer or on consumers. This will strengthen the liquidity of the sector.”

The finance ministry said in a statement the plan was executed with the support of 18 commercial banks, coordinated through the Pakistan Banks Association and backed by the State Bank of Pakistan.

The circular debt had become one of the most serious drags on the economy, repeatedly flagged by the International Monetary Fund (IMF) during its engagements with the government.

The announcement of financing comes ahead of the expected arrival of an IMF mission for the second economic performance review under a $7 billion program.

The government said the deal involves restructuring Rs660 billion ($2.31 billion) in existing loans and arranging Rs565 billion ($1.98 billion) in fresh financing to clear overdue payments to power producers.

Repayments will be covered by an already levied surcharge of 3.23 rupees ($0.011) per unit of electricity, avoiding new charges for consumers.

The package also frees up Rs660 billion ($2.31 billion) in sovereign guarantees, which the government said will channel liquidity toward agriculture, small and medium-sized businesses, housing, education and health care.

Prime Minister Shehbaz Sharif joined the ceremony by video link from New York, where he is attending the UN General Assembly.

He called the debt workout a major achievement, adding that the government’s next steps would be privatizing power distribution companies and tackling line losses in the grid.

ISLAMABAD: Pakistan will develop a nationwide network of modern exhibition and display centers aimed at boosting exports, strengthening local industries and attracting foreign investment, the commerce ministry said on Thursday. 

The move is part of a broader strategy to modernize Pakistan’s trade infrastructure and bring it in line with international standards, as the South Asian nation seeks to deepen integration into global supply chains and position itself as a competitive hub for manufacturing and services. Officials say the new facilities will support small and medium enterprises, showcase domestic products to overseas buyers and provide a platform for international trade fairs and industry events.

“The first priority is the establishment of an Expo-cum-Display Center in Islamabad that will provide a world-class trade and exhibition venue in the federal capital,” Commerce Minister Jam Kamal Khan said in a statement, adding that “securing new land for the Quetta Expo Center, preferably near the airport to ensure easy access for foreign visitors and investors,” was the second key focus.

Potential sites for the Islamabad facility include the Pakistan Sports Complex, where existing infrastructure could help reduce construction time and costs. In Quetta, the government is considering locations with direct access to transportation links to better serve international exhibitors and business delegations.

If fully implemented, the plan would mark a significant expansion of Pakistan’s trade promotion infrastructure. The government hopes the new centers will not only expand export opportunities but also attract foreign investors seeking to partner with Pakistani firms in sectors ranging from textiles and agriculture to engineering goods and information technology.

The Pakistan Expo Center (Private) Limited, which presented the plan to the commerce ministry this week, said the initial design would be prepared under an open bid model, with construction to begin once funding is secured through the Export Development Fund, the federal Public Sector Development Programme, or other approved financing channels.

Letters have been sent to all four provincial governments and the Capital Development Authority to identify land parcels for small-scale centers. Sialkot and Faisalabad have already offered sites, while proposals from Sukkur, Hyderabad and Quetta are under review. 

The concept includes building multipurpose halls in secondary cities to host trade delegations and industry events, drawing on international best practices including modular designs used in Germany and other major exhibition markets.

The government also plans to restructure the board of Pakistan Expo Center to strengthen governance, improve decision-making and accelerate delivery of the projects. 

Commerce Minister Khan said the initiative would help energize local industry and create new opportunities for foreign investment by combining Pakistan’s low-cost manufacturing base with exhibition infrastructure built to global standards.

He directed the federal industries ministry to submit detailed proposals on key industrial clusters and priority sectors from all provinces within a week so that final decisions on construction and funding could move forward.