ISLAMABAD: The government has reportedly shown willingness to amend/ modify Pakistan Energy Revolving Account (PERA) to sort out concerns of Chinese lenders of CPEC IPPs with respect to payment in future, sources close to Managing Director PPIB told Business Recorder.
MD PPIB, sources said, has shared a report of meeting on PERA with Suo Yun Peng Director Asia and Africa Division, Department of International Cooperation National Energy Administrations, China and Gu Hong Bin Vice President of China Renewable Energy Engineering Institute (CREEI), requesting them to coordinate with CPEC IPPs, respective lenders and Sinosure to get their acknowledgment on the satisfaction of the Revolving Account arrangement shared by CPPA-G or comments on it, at the earliest. This will trigger the next meeting leading to the meeting of Joint Energy working Croup (JEWG) accordingly.
Sharing the details, sources said a high-level meeting was held online during first week of Feb, 2023 between Pakistan and China, presided over by Secretary Power Division.
Protection of Economic Reforms Act: MoF asks Power Div to satisfy Chinese lenders
The Chinese side comprised representatives from China Renewable Energy Engineering Institute (CREEI), Export Import Bank of China (EXIM Bank), China Development Bank (CDB), China Construction Bank (CCB), Agriculture Bank of China (ABC) and Industrial and Commercial Bank of China (ICBC) but Sinosure, the Chinese insurance company, representatives were not present.
From Pakistani side, the representation was from Ministry of Energy (Power Division), Ministry of Finance, PPIB, CPEC Authority, Pakistan Embassy in Beijing, CPEC IPPs and CPPA-G.
Secretary Power asked the Chinese lenders to share their views and comments on the Revolving Account Framework presently being followed by the Government of Pakistan in lieu of Revolving Account as per Revolving Account Agreement (RAA). But before that the background of the issue under consideration was highlighted by MD-PPIB, Shah Jahan Mirza and then the CEO CPPA-G. Rehan Akhtar updated the participants about the basic features and the implementation status of Pakistan Energy Revolving Account (PERA).
Additional Secretary, Ministry of Finance informed the participants that the current scheme of payment with respect to Revolving Account is backed by GoP as the decision is made by the Federal Cabinet of Pakistan and Rs50 billion has already been approved by the Cabinet for the current Financial Year, i.e., (up to June, 2023) for onward payments to CPEC projects in respect of Revolving Account. However, on monthly basis, the amount of Rs. 4.00 billion can be withdrawn from PERA for payment to CPEC-Projects, as per the Federal Cabinet decision.
The queries raised by the Chinese lenders with respect to the continuity of the present scheme of Revolving Account, the responsible ministry for operations and maintenance of the Revolving Account, the tariff related issues along with the amendments required to be incorporated in Revolving Account Agreement, were responded by Pakistani side and the Chinese side were assured of the commitment of Government of Pakistan to keep the Revolving Account operational based on the consent/ acknowledgement of the lenders on the satisfaction of the Revolving Account opened with State Bank of Pakistan (SBP), in the spirit of cooperation.
Copyright Business Recorder, 2023