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Senate panel for higher hydel profit payments to AJK

Updated February 27, 2019

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A file photo of the 84MW Laraib hydropower plant located on Jehlum river in Azad Jammu and Kashmir.
A file photo of the 84MW Laraib hydropower plant located on Jehlum river in Azad Jammu and Kashmir.

ISLAMABAD: The Senate Standing Committee on Water Resources on Tuesday supported a report of the special committee recommending payment of Rs1.15 per unit charges to Azad Jammu and Kashmir (AJK) on hydropower generation on the pattern of net hydel profit (NHP) to the provinces and sought an early resolution of the matter to the satisfaction of the people of AJK.

The meeting was presided over by Senator Shamim Afridi and attended by senators Sana Jamali, Quratul Ain Marri, Ahmed Khan, Muhammad Usman Khan Kakar and Senator Gianchand.

The matter came up during the course of discussions on Neelum-Jehlum Hydropower Project. The committee was informed that this project was of extreme importance and work on it commenced on Jan 30, 2008.

It was reported that AJK used to be paid 15 paisas per unit charges on power generation from Mangla Dam under a 2003 tripartite agreement, which was increased to slightly over 42 paisas per unit in 2013.

Following the commencement of Neelum-Jhelum project, the AJK government demanded that it should be treated at par with provinces in the matter who were being paid significantly higher NHP now, standing at Rs1.15per unit with annual adjustment of 5pc.

To ensure that all parties were compensated fairly, a tripartite agreement was drafted that was approved by the previous government for the payment of NHP and Water Usage Charges to AJK that also constituted a committee comprising secretaries of finance, water and chief secretary of AJK to work out modalities.

The committee recommended that under a 1970 agreement with the federal government, AJK has to be treated fairly and at par with provinces for all practical purposes given its peculiar status and hence it supported payment of Rs1.15 per unit charge to AJK even if there was no such provision in the constitution.

The report was taken up at the federal cabinet level recently where the prime minister advised that the matter should be cleared by the ECC. The committee was told that Ministry of Finance had opined that under Article 161 (2) of the Constitution, NHP was admissible only to the provinces.

The committee was informed that a result of finance ministry’s opinion, AJK was at a loss and since most of the hydropower potential was available in AJK and Gilgit-Baltistan, they should not be antagonised and have to be treated like the people of other provinces if not better. The committee noted that people’s lives had been distorted and mass migrations had taken place and may remain the case in future projects as well.

Therefore, Senator Usman Khan Kakar stressed the need for payment to be made at the earliest and without any discrimination when compared to provinces so that the people of AJK may be recompensed. The committee was informed that the matter had already been referred to the Economic Coordination Committee (ECC) and a decision was awaited very soon to be then endorsed by the cabinet.

The committee appreciated the steps taken by the relevant authorities leading to Rs18 billion reduction in the bid price by the consortium of Mohmand Dam contractors. The meeting also discussed the issue of compensation to the affected persons of Mirani Dam. Senator Mir Kabeer Ahmed said the matter was a serious one and had been lingering on for 11 years. He said there was a marked difference in dollar rates and that the affectees must be compensated accordingly.

Quoting a letter on behalf of 2,700 affected persons of Mirani Dam, it was asserted that numerous upstream karez and orchards have been destroyed as a result of which mass migrations have taken place and the affected persons were seeking 300pc increase in compensation rates.

Senator Ahmed Khan protested over the low compensation rates and noted that as per Asian Development Bank rules, complete payments to land owners and affected persons was a prerequisite to begin work projects.

It was asserted that the finance and irrigation departments and the Government of Balochistan, along with Deputy Commissioner Kech, should be summoned in the next meeting.

Published in Dawn, February 27th, 2019