Energy trade: Pakistan moves closer to electricity import from India

Published: December 24, 2013
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Sources said preliminary discussions with India were under way and tariff matters still needed to be finalised. DESIGN: TALHA KHAN

Sources said preliminary discussions with India were under way and tariff matters still needed to be finalised. DESIGN: TALHA KHAN

ISLAMABAD: 

At a time when the international court has allowed India to divert water from the Neelum Jhelum River for the Kishanganga Dam in Indian-controlled Kashmir, Pakistan is set to sign an initial deal for import of electricity from Delhi to overcome a crippling power crisis.

Sources told The Express Tribune that the Ministry of Water and Power had sent draft of a memorandum of understanding (MoU) to the Law Division for vetting, before signing it to pave the way for electricity import.

The previous government had taken an initiative to buy electricity from India to overcome the energy crisis in Pakistan. Former prime minister Yousaf Raza Gilani had given the go-ahead for electricity import.

“The two sides are likely to ink an MoU for electricity trade,” a source said, pointing out that this was going to happen despite the fact that Delhi had succeeded in getting a decision in its favour from the International Court of Arbitration.

The court has permitted India to divert water to the Kishanganga Dam, which will hurt 900-megawatt Neelum Jhelum hydropower project being set up in Azad Jammu and Kashmir (AJK).

India has offered to supply about 500MW of electricity in the beginning and this plan could be implemented within a year by laying a transmission line.

http://i888.photobucket.com/albums/ac89/etwebdesk/500MW_zpse66f9c33.jpg

A senior government official said Pakistan felt that it could import 2,000-2,500MW of power from India to tackle the acute shortage which had hit its economic growth bringing it down to 3% a year.

India has also expressed interest in exporting oil, but since Pakistani refineries produce low-quality oil whereas India produces oil of Euro 2, 3 and 4 standards, they cannot press ahead with the plan.

“Now, the World Bank has come up with a proposal, saying it can provide technical assistance for conducting a feasibility study of the power import programme,” an official said.

Delhi had told Islamabad that it faced problems in interconnection of power, however, Pakistani officials insisted such issues would be resolved later and the two sides were now set to sign an MoU for electricity trade, he added.

Sources said preliminary discussions with India were under way and tariff matters still needed to be finalised.

“However, the MoU will be an initial commitment to India,” the official said, adding the government of Pakistan was also working on other power import projects like Casa-1,000MW and electricity purchase from Iran.

Pakistan is currently importing 35MW of electricity from Iran to meet requirements of Gwadar, while work on increasing it by 100MW is going on. The two sides signed an agreement on the project in 2007.

Pakistan also has another project in the pipeline for import of 1,000MW of electricity from Tajikistan under Casa-1000 programme. Feasibility report of the project has been finalised and work is expected to be completed by 2016.

The country’s power production ranges between 10,000MW and 16,000MW against total installed capacity of 20,800MW. Globally, most countries generate 80% of their power requirements from their installed infrastructure, but Pakistan’s generation capacity only meets 65% of the needs due to old plants, poor maintenance and high circular debt.

Published in The Express Tribune, December 24th, 2013.

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Reader Comments (16)

  • polpot
    Dec 24, 2013 - 4:37AM

    Two obswervations @ Author
    +++++++++++++++++++++++++
    1.”the fact that Delhi had succeeded in getting a decision in its favour from the International Court of Arbitration.”. Incorrect. The award is a Big Victory for Pakistan according to the Water & Power Minister.
    2.” its economic growth bringing it down to 3% a year.”Incorrect. The PM has announced the growth rate as 5 % and inadvertently you belittle his achievment.

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  • polpot
    Dec 24, 2013 - 4:54AM

    “Energy trade: Pakistan moves closer to electricity import from India”
    +++++++++++++++++++++++++++++++++++++++++++++
    What will come first? Daimer Bhasha Dam or electricty Imports from India?

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  • Kaftan
    Dec 24, 2013 - 9:51AM

    I was in India last summer and they had at least 6 hours of load shedding daily there, sometimes more. Now where will India find the electricity to export it to Pakistan? This to me seems more like Nawaz Sharif is trying to impose Washington’s new ‘Silk Road order’ in this region which calls for economic and cultural dependence of Pakistan on India.

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  • Pawan
    Dec 24, 2013 - 10:40AM

    @Kaftan, I agree that there is load shedding of at least 6 hours and some time more. But this is the condition in poor states such as U.P., Bihar and some other states. I am from U.P. and lived in different part of india. Some states and thermal power companies in India are having electricity in surplus, but other state have to buy it and since U.P.and Bihar don’t have/don’t want to spend money on electricity, they have to deal with load shedding. If you see the condition of Punjab, Haryana and southern states, there is no problem except some 1 hour load shedding. In simple words, India (read some states) are having surplus electricity and anyone who is having money (in this case Pakistan), can buy it..

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  • polpot
    Dec 24, 2013 - 10:52AM

    Compliments to the artist for the picture with the Indian and Pakistani Poles
    +++++++++++++++++++++++++++++++++++++
    Poles apart? Next would be Manmohan Singh and Nawaz Sharif dangling from the cables?

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  • Indian reader
    Dec 24, 2013 - 11:38AM

    @Kaftan: I wonder which place you visited in India ?

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  • Sri Varahadev
    Dec 24, 2013 - 11:58AM

    From the ET Article : “Pakistani refineries produce low-quality oil whereas India produces oil of Euro 2, 3 and 4 standards”

    +++++++++++++++++++++++++++++++++++++++++++++++++++++++++

    The universal adoption of Euro 2 standards for fuel by Pakistan would benefit Pakistan’s environment far more than fretting about Indian pollution of the Siachen glacier:

    http://tribune.com.pk/story/640977/presence-of-indian-forces-is-harmful-to-siachen-glacier-sartaj-aziz/

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  • Sri Varahadev
    Dec 24, 2013 - 12:02PM

    Trust India’s negotiators will take note of Pakistan’s attempt to renege on the gas purchase contract entered into with Iran despite there being a take or pay clause and foreclose any wiggle room to Pakistan.
    This could be done by having the take or pay clause covered by the unconditional guarantee of a first class international bank that is both non Pakistani and located outside Pakistan. Similarly the complete cost of building of transmission line and associated infrastructure to evacuate electricity to Pakistan should also be covered by the unconditional guarantee of a first class international bank that is both non Pakistani and located outside Pakistan. Also purchases of electricity should be covered by an irrevocable letter of credit issued by a first class international bank located outside Pakistan.

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  • Zarb e Hanood
    Dec 24, 2013 - 12:21PM

    What is stopping China from offering to export electricity to Pakistan?

    Once China starts exporting electricity one more slogan could be added to the existing bouquet of slogans to describe the friendship, such as “Higher than the Himalayas”, “Deeper the Oceans”, “Sweeter than Honey” etc.; namely “More Electrifying than Lightening”

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  • AK47
    Dec 24, 2013 - 5:09PM

    Mutual trade between Pakistan and India is in the best interest of both countries.

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  • vx
    Dec 24, 2013 - 6:27PM

    Now Indian Punjab have surplus power so they can sell to other states of India or to Pakistan.

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  • unbelievable
    Dec 24, 2013 - 7:03PM

    This deal makes perfect sense – but in S Asia logic never seems to trump emotions/bias so .I wouldn’t hold my breath.

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  • Topsy turvy world
    Dec 24, 2013 - 8:38PM

    What am I hearing right Pakistan will soon be using Hindoo/Sikh electricity what will the mulla’s say ,,, LOL, what a funny country with even weirder people…

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  • optimist
    Dec 25, 2013 - 12:25AM

    @ Indian Reader
    Narinder Modi recently said in his famous Delhi rally that there was no electricity even in Delhi.
    .
    Modi was saying that even hospital life saving services (operations) were being disrupted because of that. Some food for thought:
    http://www.business-standard.com/article/companies/load-shedding-cripples-tirupur-s-knitwear-industry-1131205007941.html
    http://www.business-standard.com/article/politics/jayalalithaa-blames-central-psus-for-load-shedding-in-tn-113112600264
    1.html

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  • Muuhajirdontreturn
    Dec 25, 2013 - 9:33PM

    @Kaftan:
    I was in India last summer and they had at least 6 hours of load shedding daily there, sometimes more. Now where will India find the electricity to export it to Pakistan? This to me seems more like Nawaz Sharif is trying to impose Washington’s new ‘Silk Road order’ in this region which calls for economic and cultural dependence of Pakistan on India.

    National Capital, where are the power cuts?.Noo cuts here.Indian electricity is grid divided, there is not one central source but many grids.This is what happens when Al qaeda meets in the jungle for training. There wont be any lights there.Please people and stop visiting India..duh polio and religion of lowers.Pakistan will have two ways out.One is Iran, the other Tajikistan. Tajikistan pulls noo strings, Russia does.Iran will do good business and they wont cheat you, but then Shia is shia and Sunni is Sunni. The third is dependence on Hindus, which is most likely as you predicted. Bangladesh has become one, Pakistan will soon follow.India is too massive , with a vast coastline and is beefing connectivity to South East Asia via kalladan multi modal transport, with a huge navy to support the move while at the same time constructing walls to fence of Barbarian tribes from the west.East Asia is a large trade mine and our North Eastern people are closely related to them and they to us.One must understand that India is broader than most people imagine it is.So, its better to be a dependent state in service of India by growing crops, mining, selling to and buying from India and help develop all people in the region as Bangladesh has rightly chosen, than to fight.Only with the resources of our satellite states can we challenge a behemoth like China and then rest of the world.

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  • Indian
    Feb 12, 2014 - 9:56AM

    @Kaftan: Which city you visited in India, I would like to know, because there are no power cuts in India at present.

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