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ISLAMABAD: Prime Minister Office (PMO) has directed Federal Board of Revenue (FBR) to alter/ amend Income Tax Ordinance in the next budget, aimed to start supply of Thar coal to local industry, well informed sources told Business Recorder.

These directions were issued at a meeting held in the PM’s Office to resolve issues of Sindh Engro Coal Mining Company (SECMC) under the chair of Mohammad Jehanzeb Khan, SAPM on Effective Governance.

National Transmission and Dispatch Company (NTDC) highlighted that progress on transmission lines is on track and already attained 77 percent completion. It highlighted the issue of Right of Way in Tando Allahyar district of Sindh.

Cost-plus reflection of transportation: PC asks Nepra to make Thar coal economically viable

NTDC officials maintained that if the issue of Right of Way is not resolved it may delay the whole project.

Federal Board of Revenue (FBR) apprised that SECMC may not provide excess coal to the industry owing to provision in the Income Tax Ordinance (Section 65) wherein it is stipulated that the said credit shall only be availed if the coal is supplied exclusively for power generation. Representative of FBR observed that the existing provision is restrictive and can be reviewed to harness the potential of Thar coal.

Secretary Railways noted that CDWP, in its meeting held on December 22, 2022 proposed cost sharing of “Thar Coal Rail Connectivity” on 50-50 basis between Federal Government and Government of Sindh. Since then, coal demand has been firmed up but Government of Sindh seems to be more interested in revenue sharing model instead of provision of loan.

After detailed discussion on the issues and considering viewpoints of all the participants, the meeting decided that NTDC will complete 100 per cent work on transmission line by the end of April 2023. NTDC will also submit weekly report to Prime Minister Office.

The meeting decided that strategic roadmap team of power sector will add milestones to the PM’s stocktaking and regular monitoring.

The meeting also decided that Chief Secretary Sindh will resolve issue of Right of Way faced by NTDC in district Tando Allahyar on priority.

FBR is to consider suitable amendments in Section 65(F) of the ITO in the next Finance Bill so that local industry may reap benefits of Thar coal.

State Bank of Pakistan in coordination with commercial banks was tasked to resolve the issue of pending LCs of SECMC’s import of coal-related machinery.

Secretary Planning is to convene a meeting on rail connectivity of Thar coal in line with the firmed up demand and develop financing modalities of Thar coal rail connectivity project of Pakistan Railways in line with decision of CDWP of December 22, 2022 wherein it was decided to share cost between Federal Government and Government of Sindh on 50:50 basis.

Copyright Business Recorder, 2023

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Tulukan Mairandi Apr 17, 2023 10:23am
That Coal is a horribly low quality coal with high water content. We are importing Afghan coal because our local coal is self-destructing (like everything else local), It chokes up and destroys the boiler with huge quantities of soot and ash, yet produces lower than average heat.
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Tulukan Mairandi Apr 17, 2023 02:06pm
Thar Coal is a horribly low quality coal with high water content. We are importing Afghan coal because our local coal is self-destructing (like everything else local), It chokes up and destroys the boiler with huge quantities of soot and ash, yet produces lower than average heat.
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Abdullah Apr 17, 2023 02:09pm
@Tulukan Mairandi, don't worry we will use and that's the need of the hour .The west needs to stop using coal first.Germany still uses it .we need to use our own resources instead of getting it from afghans and other countries. Pakistan first. You can leave for India dear.
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ali Apr 17, 2023 03:53pm
@Tulukan Mairandi, mixture would be used to reduce cost. e.g. 20% thar, 80% imported
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Az_Iz Apr 18, 2023 05:14pm
@Tulukan Mairandi, Thar coal is already producing the cheapest electricity in the country. Thar is producing about 12million tons of coal a year, saving about $400 million in foreign exchange. The operational installed capacity is about 3GW. And don’t forget, India and China produce more than half their electricity from coal.
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Yousaf Ali Apr 21, 2023 04:08am
@Tulukan Mairandi, Thar coal is bituminous and sub-butiminous and its not horrible FYI. At today's prices of this grade, the resource is around $18 Trillion in value. Every country is using coal for cheap electricity and gas. Why should we not use our resources to save Billions in oil imports per year? Why are you so pessimist in every article? Like you want Pak to fail and default. Plz shut it.
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