The Federal Government said on Wednesday that it has decided to take the case of K-Electric (formerly Karachi Electric Supply Company (KESC) to the Supreme Court as the company is still getting 350 MW from national grid in alleged violation of a decision of the Council of Common Interest (CCI). This was claimed by the Additional Secretary Incharge Ministry of Water and Power, Saif Ullah Chatha at a poorly attended briefing to the Senate Standing Committee on Water and Power. Out of 15 only three Senators - Zahid Khan (Chairman), Humayun Khan Mandokhel and Nisar Muhmmad - attended it.
Additional Secretary Water and Power told the committee that the CCI had terminated the agreement between Federal Government and K-Electric but the latter obtained a stay order from Sindh High Court (SHC). According to him, stay order has not been vacated so far and now Attorney General for Pakistan has been requested to move SC for the vacation of stay order.
Senator Zahid Khan said the committee prepared a comprehensive report on KESC that took nine months and tabled it in the Senate but no action has been taken so far. He alleged that KESC had committed, in the altered agreement, to invest $316 million to improve the system but the power entity failed to fulfill its obligation. "K-Electric did not invest the committed amount in the system but got more money from the government as well as additional electricity," Zahid Khan added.
Briefing the committee, Managing Director, National Power Construction Company (NPCC), Ijaz Malik pointed out difficulties in getting mega contracts in the Middle East especially in Saudi Arabia as the federal government is unwilling to extend sovereign guarantee. Presently, NPCC cannot bid for a contract over and above Saudi Riyal 250 million. He said NPCC is competing with Indian and South Korean companies in the Middle East.
Additional Secretary Water and Power informed the committee that the company needs $100 million sovereign guarantee which the GoP is unwilling to extend because it puts pressure on the debt. The company is on the list of entities which are being offered for privatisation. The representative of Finance Ministry, Ahmad Hussain Ghumman, informed the committee that Finance Ministry cannot extend a sovereign guarantee without prior approval of Economic Co-ordination Committee (ECC) of the Cabinet.
The Committee directed Additional Secretary Water and Power to submit a summary to the ECC in this regard and opposed privatisation of NPCC. Senators also expressed displeasure over the performance of NPCC saying the company''s turnover was Rs 7 billion last year, of which Rs 6.80 billion was spent on expenses and only an amount of Rs 200 million was shown as profit. Senator Humayun Khan Mandokhel stated that if the company is handed over to him profit would be manifold.
Senator Zahid Khan expressed annoyance at the absence of Chairman Wapda, Zafar Mehmood, from the meeting and made it clear that committee''s instructions are not being implemented in letter and spirit, threatening to take action against erring officials if this practice continues. Senator Humayun Khan Mandokhel challenged the Managing Director, National Transmission and Dispatch Company (NTDC), Tahir Mehmood for not completing DG Khan Lora Lai transmission line as per commitment with the committee. MD, NTDC, however, committed to completing the project by July 31, 2014. Chief Executive Officer Neelum Jhelum hydropower project informed the committee that over 61 per cent development work is completed and invited the committee members to physically inspect the site of project.
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