Gilani invites political advice on energy subsidies

Government-industry energy council formed to address gamut of issues.

Zia Khan April 11, 2011


The government on Sunday elicited suggestions from leading national politicians on whether to continue subsidies into the next fiscal year even as energy sector stakeholders were huddled in meetings on how to end power shortages.

Inaugurating the three-day national energy conference on Sunday, Prime Minister Yousaf Raza Gilani said his administration would consult heads of all political parties on the matter before finalising budget proposals.

As an immediate measure, Gilani announced the formation of a government-industry energy council to address several issues and to make “far-reaching” recommendations to departments directly dealing with the problems.

Gilani expressed the hope that foreign investors would facilitate the country in technology transfer, form international joint ventures, and bring foreign investment to the country’s energy industry. To achieve accelerated GDP growth, he said, the national economy needs a reliable, uninterrupted and an affordable supply of energy. He said Pakistan today was facing the overwhelming task of bridging its energy demand and supply gap that was likely to double in the next 15 years, unless attended urgently by all the stakeholders, including the private sector and the government.

During the conference several proposals aimed at energy conservation during summer, including two weekly holidays for the public sector, daylight saving time and early closure of businesses will be taken up.

The electricity shortfall in Pakistan has already reached beyond 3,000 megawatts, forcing distribution companies to suspend supplies for both domestic and industrial consumers for more than six hours in major cities.

In small towns and rural areas, the outages are even longer.

But Gilani said the problem was not that simple and the government alone could not resolve it. “It requires concerted and joint efforts by all,” he said.

“We are walking a tight-rope, balancing the public expectations and the economic rationale of reducing subsidies on energy,” the premier added.

“As major players of the industry, I call upon you to come forward and play the role befitting your stakes in the country’s development and economic prosperity,” he told top executives from the petroleum sector.

The conference will last till Tuesday.

The premier said the government had already given a subsidy of Rs35 billion on the petroleum products and had no option but to raise their prices in view of global hike.

“The government can give subsidy but the matter has to be discussed with the finance minister as the fuel prices have sharply increased the world over and the country is facing serious economic challenges,” Gilani said, hinting at another fuel price hike in the offing.

About his meetings with Pakistan Muslim League-N leader Nawaz Sharif and Muttahida Qaumi Movement chief Altaf Hussain in London, the prime minister said the political leadership was united and unanimous in facing grave economic and security challenges.

Regarding the issue of the devolution of the Higher Education Commission (HEC), Gilani said the government was able to handle all challenges.

According to APP, the country needs to aggressively find new oil and gas reserves, optimise production from existing fields, enabling gas imports from across the borders via regional pipelines and liquefied natural gas (LNG) shipments.

The government, he said, is encouraging foreign investment in energy infrastructure development and in a broader context, development of alternative sources of energy and energy conservation, for a sustainable energy supply.

“Our government is also trying to move fast to start importing natural gas via LNG and regional pipelines in the near future,” the prime minister said.

He said development of local energy sources, including hydel projects and the Thar coal-fields, also remains a high priority for this government.

He said the share of natural gas as one of the primary energy source has increased from 40 per cent in 1999 to 60 per cent in 2010 and currently the entire domestic natural gas production was being consumed while providing for approximately half of the total energy requirements.

The event also saw the formal launch of the 2011 Pakistan Energy Outlook Document. (Additional input from APP)

Published in The Express Tribune, April 11th,  2011.


Ahmad | 10 years ago | Reply How about this for a political advice, leave government and let any other like imran khan run it. I am sure he will do better.
Sultan Ahmed | 10 years ago | Reply Every step should go to the national interest, power crisis must be ended, leaders can destroy it by shaking hands.
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