Loss-Making SOEs Bleed Rs. 2.8 Billion a Day: Finance Ministry Report

Pakistan's state-owned enterprises (SOEs) experienced a 30% drop in adjusted profit to Rs. 80.5 billion in the first half of FY26, according to the Ministry of Finance's latest SOEs Monitoring Report. The power sector remains a major financial burden for the government, with the circular debt in the sector rising by Rs. 374 billion.

Loss-making SOEs are estimated to incur daily losses of around Rs. 2.8 billion, while the government provides nearly Rs. 6.6 billion daily through subsidies, grants, loans, and equity injections. This financial support, estimated to be equivalent to 11% of federal budgetary receipts, is straining public finances and limiting government spending on development.

The SOEs' balance sheet deteriorated during the period, with total assets falling 2% to Rs. 37.107 trillion and liabilities rising 1% to Rs. 30.7 trillion. The majority of SOEs' debt exposure is foreign currency-denominated, exposing the government to exchange rate fluctuations, refinancing risks, and external financing needs. Profitability remains heavily concentrated in a few companies, particularly in the oil and gas and financial sectors, making the broader SOE portfolio susceptible to changes in commodity prices, exchange rates, regulations, and economic conditions.