KARACHI: Chairman of the FPCCI Advisory Board and National Business Group Pakistan, President of Pakistan Businessmen and Intellectuals Forum, Mian Zahid Hussain said that the power sector held the people and the economy hostage for the last 30 years.
He said that the public and the business community across the country are paying heavy price for keeping the incompetent and corrupt power sector afloat. Still, they can't bear the burden now. Mian Zahid Hussain said that the Federation of Pakistan Chambers of Commerce and Industry has highlighted this issue and created public awareness, so the government is now inclined to conduct a forensic audit of IPPs to satisfy the public.
He said that the government is compelled to take real and effective measures.
Federal Minister of Energy Owais Ahmed Khan Leghari has promised that electricity prices will be reduced this month and brought to par with other countries in a few more months so that Pakistani manufacturers can reduce their costs and sell their products.
Making exporters able to compete in global markets at competitive prices is welcomed by businesses, he informed.
Mian Zahid Hussain said that the IPPs and supportive bureaucrats have created a trap against the people and the economy that has become impossible to escape, but despite this, dozens of new IPPs are being set up.
Non-transparent contracts, payment in dollars instead of profits in rupees, collusion with private power company owners, over-invoicing by IPP owners, tax exemptions, violation of open bidding laws, and record corruption in power companies inevitably result in circular debt.
The burden of this debt has left the economy almost dead. While making contracts with IPPs, the electricity transmission and distribution system was not upgraded, so trillions of rupees could be paid to private power plants without generating electricity.
To solve all these problems, a policy of continuous increase in the price of electricity was adopted. As a result, the people's and the industrialists' purchasing power was lost, and many industries were closed.
He said that to survive, people started taking loans to install solar systems in this situation, which gave discos another opportunity to make money.
Presently, Discos are receiving up to fifty thousand rupees in bribes for installing a single residential green meter, which is distributed very honestly from top to bottom.
Power plants worldwide are paid up to thirty-five percent according to their capacity, which in Pakistan is between sixty two and seventy percent.
He informed that, at present, the government itself is taking fifty percent of such payments, while China's coal-fired power plants are receiving thirty-five percent.
Mian Zahid Hussain said that, like the tax system, the electricity system has also been made so complicated that most consumers cannot understand it. This gives the power companies an opportunity for further corruption while consumers are left high and dry. Therefore, taxes on the electricity tariff system should be reduced by 30%, and different slabs should be made easy to understand.
Copyright Business Recorder, 2024