Pay for power? No thanks

Ludicrous as it may seem the government is unwilling — but probably not unable — to pay the bills of private power producers thus maintaining the toxic fallacy of circular debt. Currently the government owes around Rs250 billion, enough to sustain a small country in the wider developing world but in order to meet the Pakistan budget deficit target of 3.8 percent in the current fiscal the power producers are sent begging. To add insult to very expensive injury the government is taking the power producers to task for having the temerity, the sheer gall, to complain in public about the unpaid bills, and is threatening to take the IPPs to court for seeking to invoke their sovereign guarantees.

For all the windy rhetoric from any politician or bureaucrat on the government side to the effect that the economy is on the upturn and all will be jam-and-cakes tomorrow this looks increasingly like there is a widespread intake of hallucinatory substances among the money-men. To state the blindingly obvious — power production is never and never will be — free. And for the government to twist and turn this way and that complaining that the IPPs did not ask for their money in exactly the correct manner is both disingenuous as well as downright insulting. How are the IPPs supposed to pay for the materials they need to create the power that they then donate free-of-cost to the government??

For the government to cry ‘foul’ when it is exposed by an advertising campaign says nothing for its strength or integrity. The circular power debt/crisis is very much a shot in the governmental foot and always has been; and the problem exists at a federal as well as provincial level. Failure to pay bills at an individual level results in a rapid termination of whatever service is not being paid for. Extrapolate that to a bill of billions and a service-utility like electricity and a picture rapidly emerges of a country that has the potential to go dark when the IPPs eventually pull the plug. Bite the bullet and pay the bills.

Published in The Express Tribune, March 31^st, 2017.

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