PRIME Minister Imran Khan said on Friday that he was seeing a “progressing and industrial Pakistan” in future as the government had managed to handle the issue of foreign debt retirement and costly electricity generation. He announced that a new agreement had been reached with the independent power producers (IPPs) according to which the cost of electricity generation will decrease and so will the circular debt.
The announcement about signing of a new deal with the IPPs was, indeed, a genuine gift that people of Pakistan have been given on the auspicious occasion of Independence Day. This is because the dream of a progressing and industrial Pakistan has been scuttled, among other things, by energy crisis and ever-increasing prices of electricity and gas that rendered our products uncompetitive in the international market. In fact, it was partly due to aggravating shortage of power that some elements in the past governments colluded with IPPs in concluding agreements for power generation on unfair terms. The zest for bridging the yawning gap between supply and demand of the electricity pushed the issue of comparatively higher tariff on the backburner but with the passage of time the issue became central to survival of the power sector in the face of mounting circular debt that the country was unable to tackle despite a series of remedial measures tried by successive governments. In this backdrop, the incumbent government deserves credit for carrying out an investigation into malaises afflicting the sector, which also highlighted the issue of illegal profits of billions of rupees earned by IPPs prompting demands for their recovery and relief to the consumers. The government was set to form a Commission of Inquiry to further probe the matter in the light of the investigation report but wisely exercised restraint on the advice of the Power Ministry that this could harm Pakistan’s relations with some foreign countries. However, the striking of a deal with IPPs shows the Government did not leave the matter at that and bargained diligently with IPPs behind the eyes of the media and succeeding in revising the terms that could ultimately benefit the consumers. We hope that trickledown effect of the exercise would be visible at the soonest, as, apart from industrial and business sectors, the domestic consumers too are finding it hard to absorb the increasing tariff without compromising their quality of life. The Prime Minister has also committed reform in distribution system to eliminate line losses and theft and meaningful progress on this front would be a gigantic step forward towards an industrial Pakistan and provision of substantial relief to the power consumers. Upgradation and improvement of the transmission and distribution system is crucial and must be done on a priority basis otherwise people would not be able to benefit from increased power generation.
