The Economic Coordination Committee (ECC) of the Cabinet has expressed its inability to modify its decision, taken in 1996, when, reportedly, the Punjab government had agreed to forego net profits from hydel power projects, including Ghazi Brotha (GBHP), situated in the Punjab, well-placed sources told Business Recorder.
However, the Punjab government claims that it had made a conditional offer in 1996 to forego the net profit accruing from GBHP "provided that other provinces follow suit and contends that while recording the ECC decision, this stipulation was inadvertently omitted," the sources further added.
This long-awaited issue was placed before the ECC on April 22, presided over by the Prime Minister Yousuf Raza Gilani. The Prime Minister directed the Ministry of Water and Power, the mover of the summary, to place it before the federal cabinet for consideration, despite the fact that the Prime Minister's secretariat had approved the inclusion of the summary in the ECC agenda. "The summary is to be placed before a higher forum ie federal cabinet for its resolution," the sources added.
Article 161(2) of the Constitution provides that " the net hydel profit earned by the federal government or any undertaking established or administrated by the federal government from bulk power generation at hydroelectric station shall be paid to the province in which the station is situated".
Another dispute over Net Hydel Profit (NHP) between Wapda and NWFP is already being heard by the Supreme Court of Pakistan as Wapda refused to accept the arbitration tribunal's decision in this regard - a committee that was constituted by the federal government with mutual consultation of both the parties.
Giving background of the dispute between Punjab and the federal government, the sources said that while considering a summary submitted by the Ministry of Water and Power on April 10, 1996 on "Ghazi Brotha Hydropower Project (GBHP), comparison of energy cost in public versus private sector" the ECC had approved the release of bridge financing of $100 million with the concurrence of the Punjab government.
Cabinet Division, in January 2003 had conveyed to Wapda that it was not possible to revise an ECC decision after a lapse of seven years and that Punjab must move a fresh summary through the Ministry of Water and Power for consideration of the ECC, the sources continued.
Seven hydropower stations with cumulative generation capacity of 1780 MW are located in Punjab ie GBHP 1450 MW, Chashma 184 MW, Rasool 22 MW, Sahiwal 14 MW, Chechoki Mallian 13 MW, Renala Khurd 1 MW and Jinnah (under implementation) 96 MW.
Earlier, Punjab government had submitted a working paper for consideration by the Provincial Coordination Committee (IPCC) and at the request of the Cabinet Division, comments of Ministry of Water and Power were also added, the sources maintained.
According to sources, Ministry of Water and Power is of the view that the right of a province established under the constitutional provisions cannot be overturned by the ECC. The Water and Power Ministry had recommended that the ECC may consider the proposal of the Punjab government for modification of its earlier decision so that the province is paid net profits in respect of hydropower stations located in Punjab as per constitutional provisions. The sources said that ministries of finance and law and IPCC Division supported Punjab's proposal however Wapda expressed reservations.
"Intent of present summary is to reiterate the constitutional position and ensure fair and equal treatment to all the provinces," the sources further said. The actual calculation of net profit and reconciling of amounts due to the province has to be based on the formula approved by the Council of Common Interests (CCI) which remains applicable till such a time as it is altered or modified.
There is an ongoing litigation between NWFP and Wapda on a similar matter that relates to computation of net profit, the sources quoted Secretary Water and Power as saying in the summary also seen by the minister.
Comments
Comments are closed.