Govt’s powers in relation to SBP explained

ISLAMABAD: Minister for Energy Hammad Azhar on Saturday said that Pakistan Tehreek-e-Insaf-led government has introduced basic reforms in various sectors, including energy, during the last three years.

Addressing a press conference in Islamabad, he said that these reforms would continue over the next five years.

The minister said the National Assembly has passed legislation regarding SBP autonomy, which was highly politicized by the opposition. In all developed countries, their central banks are independent, he added.

He said the federal government would own the entire assets of SBP while the appointments and removals of the SBP governor, deputy governor, and board of directors were also in the domain of the federal government. The legislation would free the SBP of politicized decisions, he added.

Previously, he said, the State Bank of Pakistan (SBP) fixed the market exchange rates on the direction of the Finance Minister, resulting in an increase in debts and pressure on foreign currency reserves, he said.

He said now rates were fixed as per market-based exchange. The customs policy was also separated from the Federal Board of Revenue (FBR) and Tax, he added.

He said our economy stood paralyzed after 1960 and gross domestic product (GDP) also could not grow like it did in other countries. Sometimes, our GDP witnessed a sudden increase and in next increase faced recession, he added.

The minister said that the country’s exports would be increased to $ 30 billion this year while Rs 6000 billion tax would be collected during the said period which would be a record.

He said the entire world has praised Pakistan for compliance of 26 points out of 27 given by the Financial Action Task Force (FATF).

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He said new power plants were set up in past without assessing the old power plants established by Independent Power Producers (IPPs). The government renegotiated deals with IPPs which would bring about improvement in the power sector, he added.

He said the government for the first time approved the Indicative Generation Capacity Expansion Plan (IGCEP) model in the country under which power projects would be set up purely through competitive bidding as per the requirements.

The minister said in past, the focus was given only to the generation of electricity while no attention was paid to power distribution in the country. In past, our system could not transmit even 20,000 MW while 24,700 MW electricity was transmitted during the last year alone, he said.

Hammad said the system could easily transmit 30,000 MW by 2023. The government has completed a 4000 MW HVDC transmission line project which was only present in the papers, he added.

He said the 2nd phase of the Neelum Jhelum transmission line project has also been completed yesterday which would supply electricity from Neelum Jhelum and Karot Hydropower Projects to Sialkot and Gujranwala districts.

He said the government successfully dismantled cartelization in agriculture and enhanced wheat support price to facilitate the farmers. The farmers were getting rates of Rs 250-300 per maund for their sugar cane, he added.

Regarding fuel cost adjustment, the minister said the past government installed power projects based on imported fuel, including LNG and coal, which resulted in variation of fuel cost prices. “Had the past government given priority to building dams today we have not suffered,” he said.

Hammad said that the incumbent government has declared this decade as the “decades of dams” and 10 mega-dams were being set up in the country. Under, the plan, 70-80 percent of electricity would be generated through local resources including hydel, coal, and Renewable by 2030, he added.

He said 5 GDP growth would be achieved this year while the foreign remittances would be of around $ 30 billion, which would be a record.

Replying to a question, he said Pervaiz Khattak has raised the issue before the Prime Minister that there was a ban in new gas connections in his constituency. He said PTI is a democratic party and every member has a right to freely express his or her views in party meetings.