ISLAMABAD - Contrary to the direction of the prime minister to immediately release Rs 15 billion to the power sector, the Finance Ministry on Tuesday released only Rs 5 billion to the Ministry of Water and Power for provision of fuel to the thermal power plants to reduce the long-hour electricity outages in the country.
“We have committed up to this level (Rs 22.5 billion directed by Prime Minister Justice (r) Mir Hazar Khan Khoso during May. Rs 5 billion have been released immediately and the rest on the need basis as we go forward,” Finance Secretary Dr Waqar Masood said while talking to The Nation.
The statement issued by the Prime Minister’s Secretariat the other day stated, “As decided by the prime minister, the Ministry of Finance will forthwith release Rs 15 billion for provision of fuel while another sum of Rs 7.5 billion will also be released subsequently on immediate basis to generate additional power to further reduce the gap between demand and supply.”
Prime Minister Justice (r) Mir Hazar Khan Khoso on Monday directed the Ministry of Finance to immediately release Rs 22.5 billion to the Ministry of Water and Power for provision of fuel to the thermal power plants. The Finance Ministry would release Rs 42 billion more next month (June) to easily maintain the supply chain of fuel to the powerhouses.
Reliable sources said total subsidy given to the power sector had reached Rs 320 billion against the budgetary allocation of Rs 185 billion for the entire financial year 2012-2013.
The overall subsidy would rise to around Rs 380 billion by the end of June 2013, as planned by the caretaker government to release Rs 64.5 billion in the remaining five weeks of the outgoing fiscal year which would be more than the double of the budgetary allocation of Rs 185 billion.
The sources were of the view that the government’s borrowing from the banking system was likely to be significantly higher in the current fiscal year due to a big shortfall in the revenue collection and massive financial injection to the power sector. The budget deficit is likely to go eight percent of the GDP due to heavy power subsidy and massive shortfall in tax collection target.
On the other side, demand and supply gap is around 9,000mw as power generation was around 7,500-8,000mw against the countrywide demand of around 16,500mw.
The massive shortfall of electricity has made lives of people miserable with mercury surging up to 42 to 46 centigrade in southern Punjab, Sindh and Balochistan. Due to the massive shortfall urban areas are facing up to 16-hou outages and rural areas 20-22 hours.
The Ministry of Water and Power believes that power outages might fall considerably after Rs 5 billion are injected into the power sector.