LAHORE -  The Standing Committee of Cabinet on Privatisation of Quaid-e-Azam Solar Private Limited (QASPL) Thursday directed the departments concerned to move a summary through the law department to the Punjab CM to exempt the company of the tax the Punjab Revenue Authority (PRA) had claimed.

The Punjab Revenue Authority, Energy Department, Planning and Development, and others would move a summary on Friday to Punjab Chief Minister Shehbaz Sharif for his approval so that the taxes on the company could be waived altogether to pave the way for its privatisation, revealed sources in the cabinet committee meeting held in the ministers’ block.

The process of privatizing Quaid-e-Azam Solar Private Limited could be delayed for not providing the company’s sales tax to the PRA. Moreover, the company had failed to present audited accounts for the year 2016-17 to the Punjab Revenue Authority for the sale tax calculation.

The Punjab Revenue Authority had served a show cause notice on Quaid-e-Azam Solar Private Limited for payment of the PRA tax at the rate of 16 percent on the value of the contract. The dispute, if not resolved, would ultimately impact the valuation of the Quaid-e-Azam Solar Private Limited and the lowest bid would be the fate of the public-funded power-generating unit.

The second meeting of the Standing Committee on Privatisation of the Quaid-e-Azam Solar Private Limited was held late Thursday that was chaired by Finance Minister Dr Aysha Ghaus Pash and attended by ministers/secretaries, representatives of the SMBR, the P&D chairman who holds additional charge of ACS (Energy) and Punjab Privatisation Board Chairman Azmat Mehmood.

Neither Punjab government spokesman Malik Ahmad Khan nor the ACS (Energy) and P&D Board Chairman Jehanzeb Khan were available for comments. However, Opposition Leader in Punjab Assembly Mian Mehmood-ur-Rasheed said the company should not be privatised.

Moreover, MPAs Dr Murad Raas and Mian Aslam Iqbal from PTI rejected the move demanding special audit of the failed project. They said the opposition wanted to know the name of the man responsible for injecting billions of rupees into the project that was not feasible at all. They said it would be privatised at minimum price to the blue-eyed people for kickbacks only. They said the Punjab government trend of the third-party validation was not fair; rather AGP’s regular audit was their demand. They blamed the government for either selling or closing the public-sector companies facing severe corruption charges in the courts.

A ruling party MPA, seeking anonymity, surprisingly said since he didn’t know anything about the privatisation move of the government, he could not comment upon it.

As per the official documents, Quaid-e-Azam Solar Private Limited had constructed Pakistan’s first utility scale, grid-connected 100MW solar photovoltaic power plant in Bahawalpur. The Total Equity of the Government of Punjab in the Project is Rs. 3.81 billion. The project has been supplying electricity to the national grid since March 27, 2015, and has achieved commercial operations with effect from 15-07-2015. The project is generating electricity higher than the required benchmarks set out by the NEPRA and therefore earning good revenue.

The Punjab Privatisation Board is carrying out the process of privatising the company. In this regard, an agreement for financial adviser’s services was signed between the PPB and the United Bank Limited on August 12, 2016, for carrying out the privatisation of the solar energy project. In the 94th meeting of the board, a transaction committee was formed to supervise the process of privatisation, besides reviewing the deliverables submitted by the United Bank Limited (financial adviser).

Upon completion of Phase-I of the project, the UBL started working on the Phase-Il for implementation of the private-sector participation plan and closure.

Accordingly, the EOI for privatisation as published in newspapers on July 28, 2017, and in two international newspapers with submission deadline of September 27, 2017. In response to EOI, a total of 26 EOIs were received. Later, 12 investors showed interest till September 27, 2017.

The UBL has submitted evaluation report of prequalified bidders on October 13, 2017, to the transaction committee for approval.

The documents further say on valuation of the QASPL. The UBL had categorically suggested that audited accounts with PRA contingency would seriously impact marketability and valuation of the QASPL.

Privatisation will be completed within 8-10 weeks after availability of audited accounts by the QASPL. The standing committee was requested to consider the above issues and make appropriate directions regarding the way forward for the transaction.

The finance minister is chairperson and industries minister co-chairperson of the committee while its members are minister for excise & taxation, minister for P&D, minister for mines & minerals, special assistant to CM, chief secretary, senior member, Board of Revenue, Punjab, P&D Board chairman, secretaries to the law & parliamentary affairs department, finance, energy, industries, information department and Punjab Privatization Board chairperson.