The government is reluctant to extend financial support of Rs 79 billion to the Water and Power Development Authority (Wapda) to cope with cash shortfall, official sources told Business Recorder here on Friday.
They said that the utility, in its case submitted to the Ministry of Water and Power said that it has incurred a cash shortfall of Rs 49.239 billion, and an accounting loss of Rs 29.136 billion due to continuation of consumer-end tariff despite increase in the prices of gas and furnace oil, higher establishment cost due to pay revision, village electrification, non-payment of Rs 10.87 billion by the Federally Administrated Tribal Areas (FATA) consumers and less availability of hydel energy.
The Ministry of Water and Power, while agreeing with the contents of the documents provided by the utility, had asked the federal government to waive DSL or convert it into equity, excluding the DSL or Faisalabad Electric Supply Company (Fesco) and Genco-1, and release cash deficit as cash grant to the utility.
The issue was discussed by the Economic Co-ordination Committee (ECC) of the Cabinet in its meeting on September 27, wherein it was decided that Finance Secretary and Wapda Chairman should discuss it with Prime Minister Shaukat Aziz.
Sources said that Wapda Chairman Tariq Hameed held a meeting with Finance Secretary as per the directive of Prime Minister, but the issue is yet to be resolved as Finance Ministry is not ready to accept the utility claim.
However, the ECC had approved a proposal of Wapda in which it had sought irrevocable guarantee from the GoP for raising Rs 7 billion emergency loan from a consortium led by National Bank, to overcome financial obligations of the Independent Power Producers (IPPs). The consortium had demanded irrevocable guarantee from the GoP for repayment of dues.
The Water and Power Ministry also complained against Finance Ministry for not dispatching its comments on summaries in time, which caused delay in taking decisions. Sources said that the Prime Minister took serious note of Finance Ministry''s attitude, saying that the ministry should give its views on the summaries promptly, whenever it is called for.
Comments
Comments are closed.