IQBAL Z. Ahmed is arguably one of Pakistan’s most controversial businessmen. Any project he touches immediately attracts media attention because of his closeness to a long list of powerful politicians, generals and bureaucrats, as well as his personal relationship with personalities like Asif Ali Zardari, retired Gen Pervez Musharraf, Shaukat Aziz and the Sharifs.

He was one of several businessmen arrested by the military dictator Gen Musharraf but was released after 42 days because the government could not find anything on him that would stick.

He has repeatedly been accused by his rivals and a couple of TV hosts of using his connections in the power corridors to secure money-making projects in “shady deals”. Yet these unproven allegations and controversies have never prevented him from expanding his business and investing in some high-risk ventures, just as it has not stopped his critics from questioning every deal he has snatched from under the nose of his competitors.

In 2005 he set up the first exclusive, state-of-the-art liquefied petroleum gas (LPG) extraction plant, Jamshoro Joint Venture Limited (JJVL), on a Sui Southern Gas Company (SSGC) facility, which was inaugurated by Mr Musharraf. The SSGC has since twice got the terms of its contract with Mr Ahmed’s company changed through the intervention of superior courts, first in 2013 and later in 2018.

Mr Ahmed believes that Pakistan has great untapped business potential but government policies and its inability to take bold decisions are impeding investment

A few years ago, the Competition Commission of Pakistan (CCP) determined that the JJVL, with a 20 per cent market share in the LPG business, of manipulating the market. It slapped a heavy fine on the company. The court suspended operation of the CCP decision because the commission was not competent to undertake such an investigation against a company with less than 40pc market share in a business.

He is still vilified for allocating LPG to marketing companies owned by his friends (or their close family members) who also happen to be politicians, bureaucrats or retired generals. But Mr Ahmed defends his decision, saying the policy allowed him to make allocations to anyone who had an Oil and Gas Regulatory Authority (Ogra) LPG marketing license.

“It’s a private business and in accordance with the law and rules I exercise my right to make allocations to whosoever I like to. You need to question Ogra on why it issued licenses to generals, politicians or bureaucrats,” Mr Ahmed, the chairman of the Associated Group, said in an interview with this correspondent.

Under Mr Zardari, Mr Ahmed brought foreign investors to set up a rental power plant on a three-year contract with the government. The project couldn’t take-off owing to widespread allegations of corruption and kickbacks in almost every rental power contract, and very high electricity tariffs; the contracts were shelved under a court order later on.

“It was a short-term solution to electricity shortages but the whole project of rental power plants was politicised at the expense of huge losses to the economy,” Mr Ahmed recalled.

In the last tenure of Nawaz Sharif, he venture into the liquefied natural gas (LNG) regasification business and won a contract to set up the $500 million second LNG terminal at Port Qasim. The project became a hot topic for some TV hosts despite the fact its tariff of $0.41 per mmbtu is one of the lowest in the world and much lower than $0.66 per mmbtu for the Engro Corporation’s terminal. The Associated Group now plans on building another terminal.

“Whenever you undertake any innovative project in this country tongues start wagging,” Mr Ahmed said. “I’ve done nothing wrong; we’ve secured every contract on merit and no law or rule was ever violated. It is a strange custom in our country that every new government will question the projects sanctioned by its predecessors. It is always easy to create controversies but it really requires a lot of courage to invest your money in high-risk business ventures.”

“The bidding process for the JJVL was cancelled thrice before it was awarded to us. We got it only because no one, including foreign companies like British Petroleum operating in Pakistan, was willing to take the risk.

“I was advised by my friends that I would lose my last shirt in this business. I took the risk and we expanded the LPG market that was previously monopolised by a few LPG marketing companies. We changed the game completely.

“Today there are 140 marketing firms and 150 LPG plants. People have invested $2 billion in the upstream and downstream LPG market with a massive impact on jobs, government revenues and 500,000 households that use LPG. It has saved the country $1bn in import substitution and fetched $250m in export revenues.

“Nobody talks about the project’s economic impact. It’s something that has never been done in Pakistan before. No one asks questions about why the gas we now process, to extract LPG, at JJVL was wasted for 12 years before we set up the plant,” says the Mr Ahmed.

In case of the LNG terminal project, Mr Ahmed, who started business in 1962 and helped create a tractor vending industry in the country in the late 1960s, says the Nawaz Sharif government cancelled three biddings for the second terminal.

“I got the contract only when no other company was prepared to invest in it. Now we want to set up a totally private terminal, which is an effort to develop a system of LNG imports, regasification, and sale outside the government. If foreign investors are ready to partner with us, even in such gloomy economic conditions and with big risks involved, it is because they trust us. It is not easy to establish your credibility with foreign investors.”

Mr Ahmed believes that Pakistan has great untapped business potential but government policies and its inability to take bold decisions are impeding investment.

“A businessman invests his capital in a business to make money. But at the same time he also creates national assets and jobs, and pays taxes to run the state. Let the businessmen do their job and you (government) focus on your job (of providing education and healthcare to the people) if you want this country to progress.

“Facilitate us; don’t block our way. The government needs to broaden its thinking and take decisions. If someone is prepared to risk his money in any business let him; if someone wants to burn his cash let him as long as it does not involve public money.”

Published in Dawn, The Business and Finance Weekly, April 8th, 2019