KARACHI, May 2: The unfinished and uncertain privatization of the Karachi Electric Supply Corporation (KESC) to a Saudi investors’ group Kanooz al Watan has prevented the installation of electric generators gifted by the UAE government to Pakistan, which would have relieved the 15 million citizens of Karachi from the frequent breakdowns and load-shedding during this summer as it would have met the entire supply-demand gap.

Mirza Ikhtiar Baig, the Chairman of the SITE Association of Industry, who is on the KESC Board of Directors raised the issue in the meeting held on last Thursday (April 28) asking a straight and blunt question to the utility management as to why the 15 million citizens are being subjected to tortures of frequent power breakdowns and the load-shedding when free generators were available for installation that should have met the power-supply gap estimated at about 300 megawatt when demand is at peak.

The KESC management took the plea that the Privatization Commission has instructed them to avoid creating a long term liability as the utility has been auctioned away to a Saudi investors’ group. “There is no liability in installation of these generators,” argued Ikhtiar Baig who wrote a letter to the Privatization Commission. The PC was reminded that these generators were gifted to the ministry of water and power.

“President Pervez Musharaf himself instructed for installation of two generators in Karachi where the breakdowns had become too frequent,” the SITE chairman recalled. The UAE government is said to have gifted a number of reconditioned power generators to Pakistan about six months ago. “The President’s orders were flouted by the ministry of water and power and it remains unimplemented till this day,” the SITE Chairman said.

The KESC Managing Director Brigadier Tariq Sadozai was not available on telephone to give management version.

The payment of Rs20.24 billion offered by the Saudi investor group remained unpaid on Monday May 2 even after the expiry of three months of the bidding on February 4 last. A well placed and reliable source in Islamabad indicated that a significant part of the bid money is expected to be remitted from London in next 24 hours. According to this source, the Saudi Prince who heads the investor group is in London and is in touch with Pakistani authorities. The payment was expected on Saturday but has been delayed for 48 hours because of some unavoidable reasons.

The same source said that the nominated German Chief Executive of the privatized KESC is in the Karachi who wants to see for himself the affairs of the utility. But no one in the KESC gave any confirmation of arrival of the German executive.

According to the bid agreement, the successful bidder was bound to make full payment within 15 days of the receipt of letter of acceptance. The letter was delivered to the Saudi investor on February 20 after the Cabinet Committee on Privatization approved the deal on February 6. The Privatization Commission secretary went to Saudi Arabia last month to persuade the group to make payment and take over management control.

According to the PC Secretary the Saudi investor has been scared by certain frustrated and disgruntled elements in Pakistan who want to give privatisation a severe setback. There are people who are convinced that a few private contractors who thrive on Rs3 billion annual procurement programme of the KESC are the real culprits. A few persons think that the Saudi investor is buying time and would come here to take over KESC in winters after the period of frequent power break downs and public outcry in the city is over. Then there are people who say that the bidder has not been able to weave a good management team.

Whatever the reason may be, the uncertainty is creating problems for augmenting power generation capacity in the city.

Another proposal given by Ikhtiar Baig to solve power shortage problem is strictly enforcement of Shop Act under which all market centres are supposed to be closed down by 8 p.m. The closing down of shops early in the evening can save substantial quantity of electric power. This issue was discussed on Monday when Sindh Governor DSr Ishrat ul Ibad visited SITE Association.