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ISLAMABAD – The federal cabinet on Tuesday approved the power division’s recommendation to revise the agreements (negotiated settlement agreements) with 14 Independent Power Producers aimed at reducing electricity costs and saving Rs 1.4 trillion for the national exchequer.
After discussion with the 14 IPPs under the revised agreements, the cabinet approved the recommendation of reductions of Rs 802 billion in terms of profit and cost of the said IPPs. An amount of Rs 35 billion in excess profits from previous years will be deducted from these IPPs. The meeting of the cabinet was held here under the chairmanship of Prime Minister Muhammad Shehbaz Sharif at the PM House. It was told in the meeting that of these IPPs, 10 operate under the 2002 Power Policy, while four others were established under the 1994 Power Policy. Besides, an agreement with one IPP from the 1994 policy has been canceled.
These revised agreements are projected to save the government Rs 1.4 trillion over their applicable duration, with annual savings of Rs 137 billion, that will benefit power consumers, the meeting was informed. On the occasion, the prime minister lauded this achievement, highlighting that it would reduce circular debt, lower electricity prices, and lead to significant national savings.
On conclusion of successful revised agreements, he appreciated the performance of the Power Minister, Advisor, and Secretary, and the members of the Task Force that was established in this regard.
The cabinet, on the recommendation of the committee formed with regard to the government’s right-sizing initiative, approved the merger of the Ministry of Narcotics Control into the Ministry of Interior Division. After the merger, the Narcotics Control Division will function as a wing under the Ministry of Interior, while the Anti-Narcotics Force will operate as an attached department. This integration is expected to save Rs 183.25 million annually in administrative and operational expenses.
Similarly, the cabinet also approved the merger of the Aviation Division with the Ministry of Defence, which will save Rs 145 million annually in term of salaries, office expenditures and other administrative costs.
The cabinet was informed that civil aviation affairs were previously under the Ministry of Defence until 2013, so keeping in view the government’s austerity policy, the Aviation Division is being merged again with the Defence Ministry. This step is expected to improve airspace management.
On the recommendation of the Cabinet Division, the cabinet approved the inclusion of a new Section 45-A in the Public Procurement Rules, 2004, allowing a procuring agency to delegate the entire procurement process or part of it to another procuring agency. The cabinet also endorsed the recommendation of the Ministry of Human Rights to send the National Commission for Minorities Act 2024 to Parliament for approval. The cabinet approved the Ministry of Law and Justice’s proposal to extend the employment contract of Dr. Muhammad Bashir as a Technical Member of the Environmental Tribunal, Islamabad, for an additional two years.
‘Challenges in education sector’
Prime Minister Shehbaz Sharif on Tuesday called for proactive steps to address the challenges in the education sector. While chairing the federal cabinet meeting, he asked the minister for education to closely coordinate with the provinces for promotion of education, emphasising this will be a major national service.
The prime minister pointed out that 22.8 million children are out of schools in Pakistan, majority of them are girls. Referring to the International Conference on Girls’ Education recently held in Islamabad, the prime minister noted that good discussions took place regarding the education of girls. He recalled that Pakistan also declared education emergency a few months back.
The PM described the resumption of PIA flights to Europe as a major achievement. He expressed the confidence that the flights to Britain will also resume, saying this will facilitate Pakistani travellers. Shehbaz Sharif also said a new crossing point has been opened on Pak-Iran border in Panjgur, saying this will promote legal trade and help check smuggling. He thanked Iranian cooperation for the opening of the new crossing point. The prime minister expressed satisfaction over the normalisation of situation in Kurram.
He said food items and medicines are being supplied to the area. He expressed the confidence that all the stakeholders will make collective efforts to keep peace intact.
The prime minister said that the security forces are continuing their operations against Fitna al Khwarij. He said an intelligence based operation in Balochistan resulted in the killing of twenty seven terrorists.
Paying tributes to the sacrifices of security personnel, he said these sacrifices will be remembered. He expressed the commitment to complete elimination of Fitna al Khwarij, emphasizing that peace will be restored in the country as was done in 2018 under the leadership of Nawaz Sharif.
‘Special Economic Zones and Industrial Estates’
The federal government on Tuesday approved a new system for the provision of electricity and a uniform tariff for the Special Economic Zones and Industrial Estates to ensure industrial development in the country.
The approval was granted at a meeting of the Cabinet Committee on Energy, which met in Islamabad today with Prime Minister Shehbaz Sharif in the chair.
The meeting further allowed single-point power supply to Industrial Estates and Special Industrial Zones and their management to provide self-connection, bill collection and other matters.
Under this system, the interference of officials of the power distribution companies in the special industrial zones and industrial estates has come to an end. In this regard, a specific operations and management mechanism is being evolved as the Power Division and NEPRA will start implementing this mechanism in next three months.
Under the system, the zone developers will not require any additional license to supply power to the industries in the zones.
Speaking on the occasion, the Prime Minister said industrial development is vital for country’s development. He directed to apply the new system to all special economic zones.
The Prime Minister said provision of electricity to industries at a uniform tariff will supplement the pace of industrial development in the country, resulting in more employment opportunities and surge in exports.
Highlighting the benefits of improving the power transmission system, Shehbaz Sharif said industries will play their key role in the further development of country’s economy.
According to the circular debt’ report from July to November last year, it is reported that a decrease was witnessed in the circular debt during the first five months of the current financial year, compared to the previous financial year.
The meeting was informed that there was an increase of 368 billion rupees in the circular debt from July to November 2023, whereas in the first five months of 2024, there was a decrease of 12 billion rupees.
The meeting was apprised that there is a total improvement of 380 billion rupees in the circular debt in the ongoing fiscal year as compared to last year.
It was told that with the increase of four percent, the receipts of power sector touched ninety six percent during the first five months of current financial year.
Additionally, a decrease of fifty-three billion rupees was witnessed in the losses of electricity distribution companies after bringing improvement in them.
Moreover, the overall prices of electricity reduced by four point six four rupees in the current financial year, which became possible after the reforms. The PM said the process of introducing reforms in the power sector is underway rapidly and its dividends are continuing to come.
He said measures are being taken for provision of cost effective, eco-friendly and uninterrupted power supply to general public. Shehbaz Sharif said steps are being taken to further reduce the cost for electricity consumers by revising the contracts of Independent Power Producers.
‘Uraan Pakistan project’
Prime Minister Muhammad Shehbaz Sharif on Tuesday said that equipping youth with professional skills was essential to increase job opportunities and the government was actively pursuing a policy to reduce unemployment by promoting the private sector.
He said the “ Uraan Pakistan” project would create new employment opportunities across the country. The prime minister chaired a meeting on his Youth Programme. The meeting was attended by Minister for Economic Affairs Ahad Khan Cheema, Chairman Prime Minister’s Youth Programme Rana Mashhood Ahmad Khan, Minister of State for IT Shaza Fatima Khawaja and senior officials from the relevant departments, PM Office Media Wing said in a press release.
During the meeting, the prime minister directed for the formulation of a strategy aligned with the market demands of friendly countries to provide employment to youth abroad, besides, desiring action against fake and unlicensed companies offering jobs abroad.
“NAVTTC and the Prime Minister’s Youth Skill Development Programme should play their role in promoting technical and professional skills. Pakistan’s future is linked to the development of the IT sector,” the press release quoted the prime minister as saying.
The prime minister was informed about the establishment of a platform named “Prime Minister Digital Youth Hub” to provide information regarding jobs and other services to the youth.
He directed that the Digital Youth Hub should be introduced in English language as well as in Urdu and all other local languages to make it accessible to the public.
During the meeting, the prime minister was briefed on the progress of the Prime Minister’s Youth Employment Plan, measures to equip the workforce with skills required by the international market and other projects.