ISLAMABAD: The government is likely to provide electricity to Special Economic Zones (SEZs) at the same rates which are applicable in jurisdictions of power Distribution Companies (Discos) and K-Electric (KE), well informed sources told Business Recorder.
If implemented this would violate the government pledge to the IMF under the ongoing programme to end concessional funding and tariffs for specific industries and to “refrain from providing new fiscal incentives to any new or existing special economic zones, and will not renew existing ones, as SEZs meant to be temporary solutions to pre-existing constraints in the business environment… and (to) refrain from creating new SEZs or EPZs going forward.”
All Pakistan SEZs survey, the largest and most comprehensive assessment of SEZs has successfully been concluded by the Board of Investment in collaboration with SEZ authorities and SIFC for which certain services and Pak Army were also requisitioned to gauge on-ground progress.
Sans formal govt approval: CPPA-G expresses inability to supply power to RSEZ
The sources said, based on the results an Action Plan has been devised in consultation with the SIFC to optimise the SEZS and make them attractive destination for investors, which amongst other includes following action: “CPPA-G/ Discos be allowed to provide to developers that opt for Nepra licences. SEZ be exempted from uniform tariff regime, with the caveat that the tariff in SEZ shall not be more than the tariffs of Discos/ KE applicable outside the SEZs. Power Division shall have to move a summary for Cabinet’s approval”.
Power Division has been requested to take appropriate action and share update on October 24, 2024(today).
Rashakai Special Economic Zone Development & Operations Company (Private) Limited (RSEZDOC) had warned the government that industrial cooperation between China and Pakistan will be affected if issues of SEZ are not settled by the government.
Rashakai SEZ is currently experiencing severe power issues that are critically hindering both operational activities and marketing efforts. These challenges include complaints from allottees regarding insufficient electricity and the withdrawal of investment by major Chinese companies, such as Alice, due to an inability to meet their power load demand.
On August 21, a meeting convened by the Minister for Planning, Development and Special Initiatives addressed these power issues, involving key stakeholders including the Ministry of Energy (Power Division), National Electric Power Regulatory Authority, Central Power Purchasing Agency (CPPA), and Peshawar Electric Supply Company (PESCO).
CEO RSEZDOC maintains that the inadequacy and instability of the temporary power supply are severely impacting allottees’ production and diminishing the investment promotions of the Rashakai SEZ. Presently, all power infrastructure both internal and external, meets the technical requirements for energisation. Concerned power authorities such as PESCO, which has successfully managed Rashakai power supply during the construction phase for over two years, are capable of supplying power to the internal network and temporarily handling Rashakai SEZ’s metering and billing process without interference from RSEZDOC.
In accordance with the previous decision, RSEZDOC has requested that Power Division to expedite the energisation of the internal distribution network.
The Minister PD&SI stated that SEZDOC has requested that the Ministry of Energy (Power Division) should consider the practical challenges and concerns of Rashakai SEZ during these deliberations and promptly communicate the proposed plan to RSEZDOC.
Rashakai SEZ, the only SEZ under CPEC operated by a Chinese entity, has received significant attention and support from both Chinese and Pakistani governments.
Copyright Business Recorder, 2024
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