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September 10, 2019

Riko Diq, IPPs cases: Pakistan to move Int’l court against damages

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September 10, 2019

ISLAMABAD: Pakistan announced Monday that it would go into appeal and challenge multi-billion dollar damages in the Reko Diq case in international court.

International court had imposed $1.2 billion damages in Karkey rental power case and $6.2 billion damages in Reko Diq case. Pakistan assets could be seized following damages imposed on Pakistan, Minister for Energy Omar Ayub Khan said this while addressing a news conference here.

Minister said that Pakistan would go into appeal against these decisions awarded against Pakistan. He blamed previous governments for taking unwise decision that resulted in such damages against Pakistan.

Besides, the country Pakistan faced a burden of Rs24 trillion debt due to failed policies of the previous governments and added that people should know about those behind such heavy loans.

Independent Power Producers (IPPs) and other parties went into international court against Pakistani government due to failed policies of previous governments. He said that assets of Pakistan abroad could be seized if damages were not paid.

Responding to question regarding circular debt, he said that 88 percent energy payments were being made to power produces and claimed to end entire circular debt in 2020. There had been loadshedding when PTI government came into power. However, he said that all feeders were operational now due to improvement in electricity supply and there is zero loadshedding in the country.

Regarding payment of Rs1.5 billion to Rosch Power Plant on account of capacity charges, he said that Economic Coordination Committee (ECC) during tenure of PML-N had approved it in 2017. He said that past government had also decided to run this power plant on LNG instead of indigenous gas. He said that this plant was being run in line with merit order instead of ‘must run’.

Khan said that there was no money to pay to IPPs during past government. He said that Rosch Power had preferred local arbitrator whereas remaining eleven companies had gone to international arbitrator. He said that government had to pay Rs14 to Rs15 billion to these companies due to award given in favour of these IPPs in international court. He said that government was making out of court settlement with the power companies to stop them from going into international court.

About Gas Infrastructure Development Cess (GIDC), he said that cabinet had taken a decision to conduct forensic audit of fertilizer plants. However, when questions were raised, the government decided to refer a matter to Supreme Court for resolution. He said that government would spend money collected on account of GIDC on development of gas infrastructure if decision in given in favour of government.

To a question he ruled out the rumours about Imran Khan minus formula and said that Imran Khan is leader of the party and would remain in government. He said that he would also come into power for another five years after next election.

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