December 19, 2007	Wednesday	Zilhaj 8, 1428

KARACHI, Dec 18: The Sindh government and business leaders have reacted sharply to the spanner thrown by a federal government energy adviser in the programme for gainful and productive exploitation of coal reserves in Thar and other areas for conversion into electricity.

“A $5 trillion worth coal that costs around $20 trillion when converted into electricity will remain bury deep under the earth for the next generation or so because of an adviser who is a migratory bird,” quipped a business leader at a gathering of businessmen last Saturday evening.

In this meeting, the President of the Federation of Pakistan Chamber of Commerce and Industry, Mr Tanvir Ahmad Sheikh, apprised the caretaker prime minister of the issue of exploitation of Sindh coal.

Technocrats, bureaucrats, business leaders and political leadership in Sindh are all in consensus to propose the fixation of an upfront tariff for all the coal-based power projects in Sindh so that investors could come up with viable plans. But not Mr Mukhtar Ahmad, the energy adviser in Prime Minister’s

Secretariat in Islamabad, who wants the process of competitive bidding by the Private Power Investment Board (PPIB) in association with the concerned provincial government for each location of coal reservoir in Thar, Badin and Sonda.

Mr Mukhtar’s advice for competitive bidding came just a day after on Dec 13 when the Economic Coordination Committee (ECC) of the Cabinet in its meeting on Dec 12, with caretaker

Prime Minister Mohammadmian Soomro in the chair, discussed the proposal of a high-powered six secretaries committee for an “indicative upfront tariff’’ for different coal fields and for fixing coal price on the basis of landed cost of imported Indonesian coal, minus the freight as a benchmark price.

The caretaker Sindh Chief Minister, Mr Justice (retd) Abdul Qadir Halepoto, has reacted instantly and in a strong-worded letter reminded the prime minister how the Chinese investor, Shenhua, was stopped from implementing a coal-based power project in Sindh on the issue of tariff.

“Frivolous impediments have been placed in the way of determining an upfront tariff for integrated coal power project,’’ he informed the prime minister.

The Sindh government now wants immediate convening of the ECC to consider the issue again.

The FPCCI leader, too, seeks a hearing with the prime minister, along with the stake-holders, so that the issue of fixing an upfront tariff may be discussed threadbare and in the context of ground realities.

What are the ground realities? A senior government official raised this question and answered himself. At present, the Board of Investment informs about 40 private power projects for investment.

Hardly five of these projects have reached financial closure during 2007 while all others are to attain financial closure in the next three and four years.

“Not a single proposal was received under the track power policy which called for bidding, pre-qualification and other formalities,’’ informed the official, who pointed out that the government received virtually all proposals after it came out with a fast-track programme under which many conditions were done away with and above all sponsors were allowed to offer an upfront tariff.

“Why not the same principle for coal-based power projects,’’ asked a businessman who said it was all the more necessary to give a kick start to coal projects as Sindh is endowed with a rich reserve that can illuminate whole of Pakistan for next several decades.

“Is it oil lobby that is putting a lid on a treasure which is precious for Sindh and whole of Pakistan,’’ is a question being raised in context of reports on the hidden margins for importing oil by oil refineries and oil distribution companies in the country.

Those associated with coal exploration and coal-based power projects have a long story to tell as to how the federal agencies, including National Electric Power Regulatory Authority (NEPRA), has been side-tracking fixation of up-front tariff issue. There is also a story about pushing out the Chinese investor Shenhua in 2004, who invested almost $10 million in initial paper work, and other exercises but was forced to quit on tariff fixation issue.

Productive exploitation of coal fields in Thar, Badin and Sonda will not only bring prosperity to people in a half a dozen districts of lower Sindh, but will also contribute immensely to progress and development of other parts of Sindh, and also to the entire country is the considered view of all economists.

A young engineer in the Planning Department complained that Sindh was denied its rightful share in national financial resources. Sindh was not given due share of river waters according to the agreed formula.

“Sindh was never given even the suppressed share of government jobs. Sindh’s best barrage irrigated lands were given to outsiders. Sindh is the highly colonised province. And if all these troubles were not enough, now Sindh is not being allowed to exploit resources.”

“Coal is our resource and we can set up a project, but tariff fixation is with the federal government,’’ answered an official as what stops the investors and the government from going ahead with coal-based power projects.

“Politics now dictates economy and keeps the country under perpetual darkness,’’ the official remarked.

“We have raised enough noises and expect to be heard soon,’’ the official is convinced that the caretaker government would take some decision on upfront tariff on coal-based projects before elections on Jan 8.