K-Electric sees light at the end of the tunnel

The year 2020 was a bad year for businesses including power utility companies and particularly for K-Electric, which reported a loss during the year in the wake of the Covid-19 pandemic. With the beginning of the end of the crisis, the Karachi-based power firm foresees a record growth in its production and sales in 2021.

“The biggest challenge in that point of time (Covid) was while the industries were shut and commercial activities were shut, we were told…you (KE) should provide uninterrupted power and even if there is a non-payment you cannot go and disconnect power. The entity lost a few million rupees and that is the reason why we reported a loss last year,” K-Electric CEO Syed Moonis Abdullah Alvi said while speaking at a panel discussion on ‘Reimagining Leadership, Productivity and the Workplace’ at the Leaders in Islamabad Business Summit. “And this year (2021) we are seeing growth, surpassing any rate witnessed in the past. As a utility hopefully we are going to deliver.”

The company is nearing inauguration of the newly set up 900-megawatts RLNG-fired power plant which was built during the pandemic to ensure the forthcoming power demand in the city can be met. Setting up such plants requires 30-40 engineers moving through the world and getting plant and machinery from across the globe. “We had only one meeting for the plant before the infection outbreak and rest of the project work was done online,” he said.

While the rest of the country had announced to adopt the ‘work from home’ model to cope with the challenge, the power company’s workers remained available in the fields to ensure supplies to “3.1 million customers (on K-Electric network) through 112,000-kilometre network of wires, which caught faults sometimes, but were fixed,” he said.

Faysal Bank Limited President & CEO Yousaf Hussain said the pandemic has accelerated digitalisation of the financial sector. “There is going to be an amalgamation of digital and financial sector technology. All of these are emerging as a new channel for the businesses to the consumers. Covid-19 has obviously increased it manifold. The financial sector has to do it. Otherwise, it will be wiped off. This is clearly the direction.”

He added, “I foresee the branches of the banks are probably going to be relevant for a while, may be in our country for 5 to 10 years, but the model is going to change absolutely. And the models are going to be largely technology driven and the branches are going to be more like supermarkets where there are various financial production being sold,” he said.

Now, the dilemma at this point of time is that the financial sector is required a lot of investment to go digital. But the returns are slow. “Because of being a cash economy, and taxation reasons…, people don’t want to be documented at this point of time and that’s why they have been avoiding the digital system,” he said.

SBP Governor Reza Baqir has said digitalisation is picking up at a very fast pace and it is rapidly increasing. “So the telecom sector will act as a major distribution channel…4G and 5G are going to play a key role,” he said.

CPEC and the way forward

Special Assistant to Prime Minister on CPEC Khalid Mansoor said that before the power plants were set up in Pakistan during the first phase of China-Pakistan Economic Corridor (CPEC_, there were 16-18 hour long power outages in the country. This had crippled business and the economy in the country.

His comments came during another session on CPEC at the business summit on Wednesday. During the first phase (2015-2020) of CPEC, the early harvesting projects including power plants, roads connectivity and Gwadar port were developed to revive Pakistan’s economy. “We, Pakistan and its friend China, started exploring Thar Coal as the West and the EU were not interested in investing in the project,” he said.

CPEC phase-II (2021-2025) is about expansion and development particularly of industries, agriculture, pharmaceuticals, and information technology, he said. Out of $53 billion investment commitments, worth $16 billion projects are already in place including power plants of 5,300MW, optical fibre telecommunication lines, Gwadar port and free zone in the port area and socio-economic development, he said.

Published in The Express Tribune, September 23^rd, 2021.

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