Ministry of Water and Power has convened an inter-ministerial meeting on the dispute with Turkish firm M/s Karkey Karadeniz Elektrik Uretim on Tuesday (today) to firm up a well thought-out response of Government of Pakistan (GoP) to Turkish Prime Minister Ahmet Davutoglu. The Turkish Prime Minister is scheduled to reach Islamabad today on a two-day visit (February 17-18) to Pakistan.
Sources close to Minister for Water and Power told Business Recorder that dispute with 231 MW rental power plant set up by M/s Karkey in the sea near Karachi is being directly handled by the Attorney General for Pakistan (AGP) while the Ministry of Water and Power as the line Ministry is not in the loop. "We have convened a meeting of all stakeholders, including Ministries of Foreign Affairs and Law, to have a detailed discussion on the present status and future line of action on the dispute," the sources added.
Both Government of Pakistan and M/s Karkey Karadeniz Elektril Uretim are contesting claims and counter claims at International Centre for Settlement of Investment Disputes (ICSID). The sources said Pakistan will have to pay $700 million as compensation for losses suffered by M/s Karkey in case Islamabad loses the case in ICSID. National Accountability Bureau (NAB) is also following the case against the Turkish company to get millions of dollars in light of a Supreme Court decision.
According to sources, the issue of M/s Karkey will come under discussion at a meeting between Prime Minister Sharif and Turkish Prime Minister Davutoglu. Pakistan, sources said, will take the stand that as the issue is subjudice and therefore very difficult for the government to intervene.
Analysts argue that Turkish investment in energy sector will be difficult until the issue of Karkey Power Company is resolved. They further maintained that there is a possibility of out of court settlement between the two countries to attract more Turkish investment in energy sector. The Foreign Office claims that a number of MoUs and agreements are expected to be signed during the visit of the Turkish Prime Minister. The fourth meeting of the Pakistan-Turkey High Level Strategic Co-operation Council (HLSCC) would be held during Davutoglu`s visit, the statement issued by the Foreign Office said.