Hitting back: K-P never invested from HDF in stocks

Finance, energy and power depts brief Ghani over PML-N accusations.

PESHAWAR: Pakistan Muslim League-Nawaz MNA Daniyal Aziz might have a solid proof that establishes that the provincial government lost millions in stocks; however, the Khyber-Pakhtunkhwa finance department’s records beg to differ.

Briefing the Minister for Information Mushtaq Ghani on the answers to the allegations on Tuesday, officials from both the finance and energy and power departments disclosed the actual position of investment in the stock market and treasury bonds etc.



Aziz had said that the Pakistan Tehreek-e-Insaf-led government had lost hydel development fund money in stocks. Finance official Najamuz Zaman said the province has not invested in the stock market for the past seven years. “Money was invested from the General Provident Investment and Pension funds in stocks, that too between May 5, 2005 and 2008.” Initial investment was Rs20 million and by 2008, the figure had increased to Rs563 million in blue chip stocks only. Against the investment, the province received Rs68 million in terms of capital gains and Rs121 million in total dividends. “During the 2009 global financial crisis, the investment’s value dropped to Rs200 million. When the market regained stability, shares worth Rs388 million were sold while Rs175 million is still in the market.”



Zaman said the HDF, that was started in 1992, has Rs26 billion. Its money is invested in the Bank of Khyber, National Bank of Pakistan and treasury bills. “K-P earned Rs13.5 billion from the HDF investment.”

Energy and Power Chief Planning Officer Syed Zainullah Shah said work is under way on five hydel projects that will produce 216 megawatts. The total cost of the projects is Rs64 billion. “When the HDF itself amounts to Rs26 billion and there is a dearth of Rs38 billion for these projects, how can we invest in the stock market?” Talking about meeting the shortfall, Shah said a private investor, in collaboration with United Bank Limited, has shown interest in investing in the projects. “356 mini-hydel projects that will produce 35 megawatts are also under-construction. Of these, 15 will be complete by mid-September.” The officer said the per megawatt cost of hydel projects in K-P stands at less than Rs3 billion while in Punjab, it soars at Rs5 billion.

Published in The Express Tribune, September 2^nd,  2015.