ISLAMABAD, Dec 10: The Economic Coordination Committee (ECC) of the cabinet on Thursday authorized Prime Minister Shaukat Aziz to persuade Chinese leadership during his visit to Beijing to reduce tariff for the 600-mw Thar coal power project to 5.04 cents per unit, it is learnt.

Inside sources told Dawn that members of the ECC were of the opinion that a sizable amount being spent by the Sindh government on infrastructure development for the project should also be made part of the tariff earlier agreed to at 5.39 cents per unit.

Dr Ashfaq Hasan Khan, adviser to the finance ministry, when asked at a news briefing about the decision of the ECC on Thar coal project, said there was no decision on the subject.

When pressed, Dr Ashfaq said the subject was taken up for discussion but some issues were involved which he could not elaborate. He was unclear whether or not an agreement would be signed on the subject during the visit of the prime minister to China starting December 14.

A participant of the meeting said the ECC approved the 5.39-cent per unit tariff finally agreed with the Chinese Shenhua Group as preparation for final discussions between the prime ministers of Pakistan and China during the forthcoming meeting.

However, Sindh's expenditure on infrastructure development and some other paraphernalia will also have to be made part of the tariff so that the final rate does not go beyond 5.04 cents per unit. The official said the ground-breaking of the project in Sindh would take place next month and all issues would have to be resolved before that time.

The approval of 5.39 cents per unit tariff for the Thar coal project by the ECC would simply improve the negotiating capacity of the prime minister, the sources said. They said Wapda had originally estimated a 3.28-cent per unit tariff for the project, while the Chinese group had offered 5.75 cents per unit.

Nepra was asked to give an indicative tariff for the project. Nepra had, however, told the government that unless it was provided firm estimate of the total cost of the project, including about 275 km of the transmission line, it could not give an indicative tariff.

It had, however, estimated that a tariff of about four cents per unit would be reasonable in view of the technology involved and low heating value of the coal deposits.

The sources said the prime minister took personal interest in prevailing upon the Wapda authorities not to resist the tariff of 5.39 cents per unit in view of a number of allied benefits of the Thar coal project, including development of the area and job opportunities for the locals.