Pakistan has resolved three of five operational issues for KE stake sale — Al-Jomaih official

Pakistan has resolved three of five operational issues for KE stake sale — Al-Jomaih official
An undated file photo of a Karachi Electric power station in Karachi, Pakistan. (Photo courtesy: K-Electric/Facebook)
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Updated 26 February 2024
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Pakistan has resolved three of five operational issues for KE stake sale — Al-Jomaih official

Pakistan has resolved three of five operational issues for KE stake sale — Al-Jomaih official
  • Al-Jomaih bought 66.4 percent share in KE in 2005 along with Abraaj Group and Kuwait’s National Industries Group
  • In 2016, consortium decided to sell stake to Shanghai Electric but sale stuck due to regulatory and other issues

KARACHI: The top official of a consortium that owns majority shares of Karachi Electric said on Monday Saudi investors were satisfied with the outcome of a committee formed by the Pakistani government to resolve regulatory hurdles and issues of payables that have been blocking the sale of the Pakistani utility to Chinese powerhouse Shanghai Electric Power (SEP) for years.

Al-Jomaih Holding Group, one of the largest business groups in Saudi Arabia, bought a 66.4 percent share in KE in 2005 as part of a consortium comprising Al-Jomaih, Abraaj Group and Kuwait’s National Industries Group (NIG). In 2016, the consortium decided to sell the stake to China’s Shanghai Electric Power and submitted an application for a National Security Certificate (NSC) to the Pakistani Privatization Commission. However, the group still awaits approval of the deal due to long-standing issues of regulatory approvals and KE’s liquidity constraints as a consequence of mounting circular debt plaguing the country’s power sector.

In January this year, Shanghai Electric reiterated its commitment to the deal. The government of Pakistan currently owns a 24.4 percent stake in K-Electric, which powers the country’s largest city and commercial hub of Karachi.

Shan Abbas Ashary, the Chief Investment Officer (CIO) of Al-Jomaih and a director at KE, said regulatory hurdles and disputes were being addressed at a “high pace” after the Saudi investment minister wrote a letter to the finance minister of Pakistan in December last year.

“After that, we had several meetings and the SIFC [Special Investment Facilitation Council] took up the matter and created a committee of three ministers,” Ashary told Arab News, referring to a civil-military body set up last year to fast-track foreign investments.

“Thanks to the Pakistani government, and thanks to the support from the Saudi government, this interim [Pakistani] government took it [KE’s issues] very seriously,” he said, adding that out of five key issues, three operational issues had been resolved while a committee had been formed to look into the remaining issues and progress was taking place.

“The outcome is satisfactory for us and I have reported it back to Al-Jomaih Group and they understand it and they appreciate it very much that progress is being made by the Pakistan government.”

He said he hoped the issues would be resolved in “several months not several years” due to the seriousness being accorded to the matter by the SIFC, whose committee comprised the ministers of law, energy and privatization.

When asked if Shanghai Electric, which had offered to purchase shares of KE for $1.7 billion six years ago, would revaluate its offer, the Al Jomaih official said:

“Shanghai Electric has just renewed expression of interest …. They will come back, do a complete due diligence because six years have passed, it’s a long time.”


Perpetrators of Bishkek mob violence will be punished, Kyrgyz FM assures Pakistani counterpart

Perpetrators of Bishkek mob violence will be punished, Kyrgyz FM assures Pakistani counterpart
Updated 21 May 2024
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Perpetrators of Bishkek mob violence will be punished, Kyrgyz FM assures Pakistani counterpart

Perpetrators of Bishkek mob violence will be punished, Kyrgyz FM assures Pakistani counterpart
  • Frenzied mobs targeted hostels of medical universities and private lodgings of international students, including Pakistanis, in Bishkek last week
  • FM Ishaq Dar told his Kyrgyz counterpart Pakistan’s main concern was the safety of its nationals, especially students, affected by Friday’s violence

ISLAMABAD: Kyrgyzstan’s Foreign Minister Jeenbek Kulubaev on Monday met Pakistan’s deputy prime minister and foreign minister, Ishaq Dar, in Astana and assured him the Kyrgyz government would bring to justice perpetrators of last week’s mob attacks on foreign students in Bishkek, Pakistani state media reported.

Frenzied mobs targeted hostels of medical universities and private lodgings of international students, including Pakistanis, in Bishkek last week after videos of a brawl between Kyrgyz and Egyptian students went viral on social media.

Pakistan has since then ramped efforts to repatriate its students from the city and more than 600 Pakistani students have returned home via three different flights. According to official statistics, around 10,000 Pakistani students are enrolled in various educational institutions in Kyrgyzstan, with nearly 6,000 residing and studying in Bishkek.

The meeting between Dar and his Kyrgyz counterpart was held in Astana, Kazakhstan on the sidelines of a meeting of the Shanghai Cooperation Organization’s (SCO) Council of Foreign Ministers, the state-run Radio Pakistan broadcaster reported.

“Kyrgyz government has taken swift action to restore law and order in the country, and the perpetrators of the mob riots would be punished under the Kyrgyz law,” the report quoted FM Kulubaev as telling his Pakistani counterpart.

During the meeting, Dar shared concerns about Pakistani students in Kyrgyzstan and requested Foreign Minister Kulubaev to ensure their security, according to the report.

He underlined that Pakistan’s main concern was the well-being of its nationals, especially the students who were primarily affected by last week’s violence.

“Bilateral relations between Pakistan and Kyrgyz Republic, especially in the domains of energy, connectivity, trade and people-to-people contacts also came under discussion,” the report read.

“Both the dignitaries expressed satisfaction at the progress of established bilateral institutional mechanisms.”

Dar arrived in Kazakhstan on Monday to represent Pakistan at the two-day meeting of the SCO Council of Foreign Ministers. He will also hold bilateral meetings with his counterparts on the sidelines of the summit.

Founded in 2001, the SCO is a major trans-regional organization spanning South and Central Asia, with China, Russia, Pakistan, India, Uzbekistan, Tajikistan, Kyrgyzstan and Kazakhstan as its permanent members. The SCO member states collectively represent nearly half of the world’s population and a quarter of global economic output.

The organization’s agenda of promoting peace and stability, and seeking enhanced linkages in infrastructure, economic, trade and cultural spheres, is aligned with Pakistan’s own vision of enhancing economic connectivity as well as peace and stability in the region.

Since becoming a full member of the SCO in 2017, Pakistan has been actively contributing toward advancing the organization’s core objectives through its participation in various SCO mechanisms.


Pakistan seeks ‘viable business plan’ for state-owned broadcasting corporations

Pakistan seeks ‘viable business plan’ for state-owned broadcasting corporations
Updated 20 May 2024
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Pakistan seeks ‘viable business plan’ for state-owned broadcasting corporations

Pakistan seeks ‘viable business plan’ for state-owned broadcasting corporations
  • A cabinet committee recognized ‘strategic nature’ of Pakistan Television Corporation, Pakistan Broadcasting Corporation
  • The development comes amid Pakistan’s push for privatization, reforms in loss-making state enterprises for IMF bailout

ISLAMABAD: The Pakistani government on Monday sought a “viable business plan” for two state-owned broadcasting corporations, the Finance Division said, amid the South Asian country’s push for reforms in loss-making state entities.

The statement came after a meeting of the Cabinet Committee on State-Owned Enterprises (CCoSOEs) in Islamabad, which was presided over by Finance Minister Muhammad Aurangzeb.

The development comes amid Pakistan’s push for privatization and reforms in state-owned enterprises (SOEs) as it negotiates with the International Monetary Fund (IMF) a fresh bailout program.

The cabinet committee reviewed a proposal of the information ministry regarding the Pakistan Television Corporation (PTVC) and the Pakistan Broadcasting Corporation (PBC).

“The CCoSOEs recognized the strategic nature of Pakistan Television Corporation (PTVC) and Pakistan Broadcasting Corporation (PBC) and directed the Ministry of Information & Broadcasting (MoIB) to present a viable business plan to the committee for efficient management of these enterprises,” the Finance Division said in a statement.

Under the last $3 billion IMF program that helped Pakistan avert a debt default last year, the lender said SOEs whose losses were burning a hole in government finances would need stronger governance.

To negotiate a fresh bailout with the IMF, Pakistan must implement an ambitious reforms agenda, including the privatization of debt-ridden SOEs.

Among the main entities Pakistan is pushing to privatize is its national flag carrier, the Pakistan International Airlines (PIA). The government is putting on the block a stake ranging from 51 percent to 100 percent.


Pakistan PM prays for recovery of Saudi Arabia’s King Salman

Pakistan PM prays for recovery of Saudi Arabia’s King Salman
Updated 20 May 2024
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Pakistan PM prays for recovery of Saudi Arabia’s King Salman

Pakistan PM prays for recovery of Saudi Arabia’s King Salman
  • Saudi king is due to undergo treatment for lung inflammation, SPA reported
  • Shehbaz Sharif says King Salman sincere friend of Pakistan, guide for Muslim world

ISLAMABAD: Pakistan Prime Minister Shehbaz Sharif on Monday extended prayers for the recovery of Saudi Arabia’s King Salman, who is due to undergo treatment for lung inflammation.

The treatment will consist of a course of antibiotics at Al-Salam Palace in Jeddah, the state-run Saudi Press Agency reported on Sunday.

The king underwent medical tests at the royal clinics at the palace earlier on Sunday after he suffered from a high temperature and joint pain.

“I have learnt with grave concern about the health of His Majesty King Salman bin Abdulaziz. His Majesty is not only a sincere friend of Pakistan but as the Custodian of the Two Holy Mosques, a leader and guide for the entire Muslim ummah,” Sharif said on X.

“The people of Pakistan join me in praying to the Almighty for His Majesty’s complete recovery and swift return to full health.”

Pakistan and Saudi Arabia enjoy strong trade, defense and cultural ties. The Kingdom is home to a large number of Pakistani expatriates and serves as the top source of remittances to the cash-strapped South Asian country.

Saudi Arabia has also often come to cash-strapped Pakistan’s aid by regularly providing it oil on deferred payment and offering direct financial support to help stabilize its economy and shore up its forex reserves.


England relish ‘fear factor’ of returning paceman Archer against Pakistan

England relish ‘fear factor’ of returning paceman Archer against Pakistan
Updated 21 May 2024
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England relish ‘fear factor’ of returning paceman Archer against Pakistan

England relish ‘fear factor’ of returning paceman Archer against Pakistan
  • Injuries have blighted Archer’s international career and he has not played top-level cricket for 14 months
  • But he is in England squad for four-match T20 series against Pakistan, starting this week, and the World Cup

LONDON: England are eager to unleash Jofra Archer’s “fear factor” against Pakistan as the paceman prepares to return from a long injury lay-off ahead of next month’s T20 World Cup, says team-mate Sam Curran.

Injuries have blighted Archer’s international career and he has not played top-level cricket for 14 months due to back and elbow issues.

He has managed just 15 Twenty20 appearances for England since making his international debut five years ago but is in the squad for their four-match T20 series against Pakistan, starting this week, and the World Cup.

The 29-year-old has been building up his fitness by playing club cricket in Barbados and last week took a wicket for Sussex’s second XI.

“It’s incredibly exciting to have a player of his quality,” all-rounder Curran said on Monday. “I’m sure England fans and players are extremely buzzed to have him back.

“He’s obviously got that extra pace and fear factor we can bring to opposition. We all hope his injuries are behind him now.

“Jof’s had a really tough couple of years — we all hope he can come back and do what he does for England and bring the A game that we know he’s got.”

England, who are reigning T20 world champions, are desperate to find form ahead of the tournament in the West Indies and the United States after a dismal 50-over World Cup defense in India last year.

Curran is one of eight squad members who returned early from the Indian Premier League ahead of the Pakistan series.

The players had little time together before the defense of their 50-over title.

“The messaging from (captain) Jos (Buttler) and the coaching staff was they wanted to get the group back together and we probably didn’t have that last time,” said Curran.

“We’ve been apart for a while so these games are going to be really crucial. We want to be playing as a team and get used to our roles.

“There’s a lot of buzz around the group, it seems like we’re back to our energy and it seems like the boys are really fizzed about this trophy hopefully coming back.”

The first game of the four-match T20 series against Pakistan takes place at Headingley on Wednesday.


Net-metering, tax controversies cloud future of solarization in Pakistan despite government clarification

Net-metering, tax controversies cloud future of solarization in Pakistan despite government clarification
Updated 20 May 2024
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Net-metering, tax controversies cloud future of solarization in Pakistan despite government clarification

Net-metering, tax controversies cloud future of solarization in Pakistan despite government clarification
  • Government says it won’t end net-metering policy for solar power producers, promises to honor commitments made by companies
  • Pakistan’s energy woes stem from high capacity charges consumers pay due to long-term government contracts with power producers

KARACHI: Controversies about net-metering and imposition of a new tax have cast a cloud over Pakistan’s transition to solar energy despite the government’s ambitious plans, stakeholders said on Monday, adding the situation has left them in a state of uncertainty.

Pakistan approved the net-metering policy in 2017 that allows consumers to sell excess electricity produced by their solar systems to power distribution companies, resulting in significant savings in their monthly bills.

However, the energy ministry stirred a controversy last month by declaring that net-metering was promoting “unhealthy investments” in installation of solar power by affluent domestic and industrial consumers, hinting at cutting the buyback rates.

“Before this [controversy], people were shifting to solar [energy] in such a way that we thought that 100 percent Pakistan embraced solar energy,” Zulfiqar Ali, an importer, supplier and installer of solar panels, told Arab News on Monday.

“Now, we’re witnessing a stark contrast, a slowdown in inquiries, stagnation in projects, all amidst a talk of governmental reconsideration of solar energy policies.”

Ali said the net-metering issue had a lot of effect on the market as the purchasing groups suddenly went silent and the deals that were going on became stagnant. “The planned projects have gone into an idle position, people are neither saying yes nor no,” he added.

Recent reports published by local media about new taxes and an end to net-metering policy further compounded the situation and prompted Energy Minister Awais Leghari to explain the government’s position on the matter. 

“We completely reject these stories. The agreements our companies have made with net-metering users, whether they are for five years, six years, or seven years, will not be altered in any way and the government will not damage its reputation, nor will it cause any inconvenience to those investors,” Leghari said at a press conference in Lahore on Sunday.

He said the government was fully committed to renewable energy and solarization and was in favor of continuing the net-metering policy. 

“If, after studying it over the next few months, there is a need to revise it, it will be done very responsibly and in consultation with stakeholders,” Leghari said.

“After the approval of the entire government, if necessary, we will rationalize this. At this moment, we are committed to fulfilling all the contracts we have signed with various people. We will uphold the integrity of the entire government and move forward together.”

But despite the government’s assurances, an atmosphere of uncertainty prevails in the South Asian country with regard to solarization.

“I wanted to install solar panels at my rooftop to mitigate the impact of high electricity bills but now I am unable to take a decision because of the government’s intended moves of either taxing panels or curtailing net-metering benefits,” said Khalid Abbas, a resident of Karachi, adding that he would wait for clarity on the subject.

Solar panel suppliers said people, who were buying solar panels by selling their cars or jewelry, had stopped purchasing the equipment. 

“Residential consumers who wanted to install 5-20KW panels have stopped and are waiting for clarity,” Zulfiqar said.

Pakistan’s energy woes stem from the substantially high electricity bills, mainly due to the capacity charges that are as high as 65 percent and the nation is bound to pay these to power producers, even though their plants stand idle. 

The power purchase price (PPP), or the average per unit price based on the generation cost, is Rs20.60, which includes Rs14.09 capacity charges, and Rs6.21 fuel and variable charges, according to Pakistan’s reference tariff for fiscal year 2023-2024.

Pakistani energy experts believe the volume with which solar energy is increasing is still “insignificant” and does not even make 1 percent of the total power generation in the country.

“But the way it is going on in Pakistan, perhaps a significant portion of our net-metering will be done from it,” Dr. Khalid Waleed, an expert on energy economics, told Arab News. “Around 2,000MWs will be coming from net-metering. So, it should not be discouraged at all.”

When consumers switch to solar power, Waleed said, capacity charges are borne by other consumers that ultimately increases their power burden. 

Experts say the country won’t be able to get rid of the capacity charges before 2050 due to long-term contracts made with power producers.