Khyber Pakhtunkhwa government has reportedly sought Rs 200 billion from the federal government on account of what it says net hydel profit arrears and gas royalty. Sources said Chief Minister of KPK Pervez Khattak took up the issue of net hyderl profit arrears as well as uncapping of NHP during a meeting with Finance Minister Ishaq Dar on Tuesday.
Sources further stated that the KPK Chief Minister also sought allocation of 100 MMcfd gas for thermal power projects in the province and a tax relief for business and industry as the province is in the front line in the war against terrorism the Finance Minister stated that the federal government would extend all possible support to KP government in economic uplift of the province. According to him, the issue of NHP will be taken up with the concerned ministries. A meeting for this purpose would be convened with Ministry of Water and Power on a priority basis after taking inputs from National Electric Power Regulatory Authority (Nepra) and Wapda to propose workable options. The meeting would be held next month with due representation from KP. All other issues related to Ministry of Water and Power and KP would be discussed and a future strategy would also be devised.
The Finance Minister maintained that the federal government appreciates development projects undertaken by the province. However, he pointed out that there must be proper consideration and approval of development projects by Executive Committee of National Economic Council (ECNEC). The Minister said "we would like to initiate a consultative process between the centre and provinces for the purpose of allocation of funds for projects as prioritized by the provinces."
He also suggested that the KP government surrender projects which it deemed unbeneficial and the funds be redirected to other priority areas. The KP side welcomed the suggestion.
Khattak also requested sovereign guarantees for hdro projects and for IPPs owned by the KP government through Pakhtunkhwa Energy Development Organisation (PEDO) for projects above 50 MW. It was decided that the Centre will facilitate the province in the matter so that financial close of the projects could be conveniently realised.
The Chief Minister KP apprised the Finance Minister of issues related to Ministry of Water and Power, Ministry of Petroleum and Natural Resources, Finance (FBR), Planning and Development. Khattak requested that KP's interests must be incorporated in the energy corridor.
A participant of the meeting on condition of anonymity claimed that the provincial government also requested operationalization of Article 157 of the Constitution regarding construction of hydro electric or thermal plants in the province. Article 157 reads that "the federal government may in any province construct or cause to be constructed hydro-electric or thermal power installations or grid stations for the generation of electricity and lay or cause to be laid inter-Provincial transmission lines provided that the federal government shall, prior to taking a decision to construct or cause to be constructed, hydro-electric power stations in any Province, shall consult the Provincial Government concerned.
The government of a province may-:(a) to the extent electricity is supplied to that Province from the national grid, require supply to be made in bulk for transmission and distribution within the Province:(b) levy tax on consumption of electricity within the Province; (c) construct power houses and grid stations and lay transmission lines for use within the Province; and (d) determine the tariff for distribution of electricity within the Province. In case of any dispute between the Federal Government and a Provincial Government in respect of any matter under this Article, any of the said Governments may move the Council of Common Interests (CCI) for resolution of the dispute". The meeting was attended by Water and Power Minister Khawaja Asif, Petroleum Shahid Khaqan Abbasi, and senior officials from the federal and KP governments.
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