Energy assistance: US asks Pakistan for ‘realistic wish list’

Published: September 15, 2011
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Finance Minister
Abdul Hafeez Shaikh said there are a number of areas where there was room for American investment particularly in the hydroelectric power, exploitation of coal reserves in Pakistan, and liquefied natural gas (LNG) import projects.

Finance Minister Abdul Hafeez Shaikh said there are a number of areas where there was room for American investment particularly in the hydroelectric power, exploitation of coal reserves in Pakistan, and liquefied natural gas (LNG) import projects.

ISLAMABAD: Even as the United States has shown willingness to finance large-scale energy projects in Pakistan, Islamabad has yet to prioritise its ‘wish list’, forcing Washington to ask Pakistani officials to focus only on strategically important projects.

Senior officials from both countries met on Wednesday as part of the Fourth Pakistan-US Strategic Dialogue on Energy, chaired jointly by Water and Power Minister Naveed Qamar and US Special Envoy for International Energy Affairs Carlos Pascual. Among the goals of the meeting was to identify projects that the US might be able to fund as part of the $7.5 billion Kerry-Lugar civilian assistance package for Pakistan.

Pakistani officials gave an overview of the energy situation in the country and then listed a series of large-scale projects that they wanted to be funded. But there appeared to be little coordination between the various government departments that made presentations.

The Water and Power Development Authority (Wapda) sought US financing for the Diamer Basha Dam, as well as the Dasu and Bunji dams, while the Pakistan Electric Power Company (Pepco) asked for funding for thermal power generation projects, said an official of the water and power ministry.

(Read: US likely to persuade Pakistan to abandon Iran gas pipeline project)

The lack of coordination comes even as the US appears to have conceded on a key Pakistani demand: that Washington finance a smaller number of large, ‘visible’ and strategically important projects rather than the dozens of smaller projects that it currently seems to be funding.

The largest programme that the US has funded thus far – providing money for the Watan Cards compensation scheme for flood victims – cost $190 million. Many of the projects funded by the US were as small as $4 million.

The reason for the smaller-scale of Washington-funded projects is what is known as the ‘earmark’ system in the US legislative process, whereby US lawmakers are allowed to request funding for proposals of their choosing. This diverts funding from projects that Pakistan needs to those US lawmakers think are important, based on their domestic, US-based constituencies.

Much of Washington’s funding thus far under the Kerry-Lugar bill has gone to projects that were so small that they did not need foreign financing.

The discussions between Pakistan and the US were meant to focus on 13 different areas of cooperation, but it remains unclear whether Washington will divert all of its funding to the power sector.

Many experts in Pakistan believe that the country would be better off reforming the energy sector to remove its many inefficiencies rather than pinning hopes on the United States to provide assistance. Pakistan’s international lenders, including the IMF and World Bank, have pointed out that Islamabad has no hope of achieving its budgetary targets until it reforms its heavily-subsidised, highly-inefficient energy sector.

Among the presentations on Wednesday were some on the energy sector reforms that Pakistan is introducing, including attempts to improve efficiency. In his opening remarks, Naveed Qamar said that Islamabad was committed to reform.

Yet officials, including Qamar and Finance Minister Abdul Hafeez Shaikh, insisted that technical and financial cooperation with the United States is essential for improving the energy sector and alleviating the chronic power crisis.

“Financial support is an important aspect of the shared understanding for the implementation of certain power projects Pakistan has started,” said Shaikh while meeting with Pauscal at the sidelines of the bilateral talks.

Shaikh said there are a number of areas where there was room for American investment particularly in the hydroelectric power, exploitation of coal reserves in Pakistan, and liquefied natural gas (LNG) import projects.

The talks are scheduled to continue on Thursday (today).

Published in The Express Tribune, September 15th,  2011.

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Reader Comments (17)

  • guest-worker
    Sep 15, 2011 - 6:54AM

    The US will never help Pakistan..!!. get that clear in your head and don’t put baseless and groundless offer from the US in your rag

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  • Sep 15, 2011 - 8:22AM

    @guest-worker:
    Agreed. Sooner we throw out Americans sooner there will be improvements in economy and law and order.

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  • Sep 15, 2011 - 9:35AM

    I guess Pakistan should tell US to keep their energy resources to themselves. I’m sure there will be some catch in the deal and ultimately we would be surrendering something in return.

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  • Shahzad Hussain
    Sep 15, 2011 - 9:41AM

    Its better to depend on our own resources rather then opting for the aid of an unreliable so called “ally”, I would prefer Iran over US for energy projects.

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  • Asim+Ali
    Sep 15, 2011 - 9:41AM

    Even Pakistan is not helping Pakistan by employing spent forces like Naveed Qamar to deal with complexities of power sector projects. Naveed Qamar has nothing to show as an achievement in his 30 years stint in politics.

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  • Praful Shah
    Sep 15, 2011 - 9:44AM

    Here you want to get rid of US Why you ask for money from US? Go and ask your evergreen friend Chinese.

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  • KR
    Sep 15, 2011 - 9:56AM

    In all reality it is easy to fix out power crises than for our government to quit running around the globe and asking for aid or even loan (without even reading the terms of the loan). Why not enforce all across the nation that people must pay their electricity bill on time and use that money wisely and invest in the infrastructure and do what all the rest of the world does try to build our nation and be proud. I know majority of us pay our bills but at the same time WHOLE BUNCH of people don’t bother paying theirs which is also called STEALING and if the WAPDA employees cannot get the job done why not fire them and replace them with some honest hard working folks for and change. I know it is very hard to believe that in Islamic Republic of Pakistan corruption and stealing still goes on. Recommend

  • KR
    Sep 15, 2011 - 10:01AM

    @guest-worker:

    Why should U.S help us???? we keep begging for more and more aid for the last 50+ years and still have nothing to show for and then try to blame everyone else. U.S is not Pakistani problem but in reality our problem is corruption, stealing and dishonest official.

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  • Sep 15, 2011 - 10:08AM

    We don’t need any energy deals with US, we need to use our energy to kick US out of this region.Recommend

  • Ahmer Ali
    Sep 15, 2011 - 11:20AM

    Assalam-o-Allaikum Warahmatullah.Once again USA is trying its utmost to fool and deceive Pakistani corrupt,beggars and slaves leaders and keep it in your mind firmly Pakistani corrupt leaders that USA is clever and intelligent enemy of Pakistan and has complete capability to take the maximum advantage of Pakistani leaders’ compulsions and also knows that how we can divert Pakistani leaders’ attentions from China,Iran and other true friends of Pakistan to assist in especially power sector and this US’ officials statement has proven that USA is trying its utmost to create differences between Pakistan and Iran because PM Gillani has already declared that no one can separate Pakistan and Iran and this PM Gillani’s statement has given a hazardous signal to USA that Iran is fully prepared to help Pakistan to over come energy crisis.

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  • Shahzad Hussain
    Sep 15, 2011 - 11:46AM

    I think the time for Pakistani government has finaly arrived where they have to decide whether they want end their tenure with diginty and honour by not anymore asking foreign aids generally and US’s Kerry Lugar Civilian or for that matter military aid particularly. We Pakistanis have survived good over 60 years and I am very much optimistic that we will do great in the future without these namesake and cunnig allies. Mr. President and Mr. Prime Minister Pakistan’s youth is rising and is rising with digity, honour and hardwork. This great country of great people is better off then asking for aids…Please develop our very own technological infrastructure so that our youth shall be utilized in developing silicon valleys for Pakistan. It is therefore requested from both of you gentlemen to kindly ponder on it and take some credible steps towards bright and properous future for our people.Recommend

  • Fghafoor
    Sep 15, 2011 - 11:50AM

    Aha it seems very alarming for us as a nation that international communities and so far called closed allays are are not trusting our Politicians.

    These are the eye opening and a chance of developments too.
    Now we have to seriously think for our country instead of our bank balances.

    We need some seriously professional plans for any natural disaster.

    I read couples of months back the reports by UN that Pakistan has no plans for floods or any natural disaster even after one year of the last year floods and 2005 earth quake.

    But our top management of the country including politicians are beggar and always wants to beg money for our natural disasters and other deficiencies.

    i’m sure none of our top management or politicians would feel shame on it.

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  • Abdul Rahman Khan
    Sep 15, 2011 - 8:00PM

    ‘Aik momin saanp ke bill sey aik hi baar dassa jaata hai’ (a true muslim is bitten by a snake in his hole only once). The history of Pakistan-Us relations over the last 46 yerars (since 1965 war, and even before that) is replete with betrayals. We shouldn’t submit to US dictates and look for our own national interests. Iran is our muslim neighbour country. We can rely on iran to make up for our energy shortfall than trusting the tried one. Iran has reportedly laid the pipeline on lits side. People of pakistan want to see the iran gas project starts getting executed on our side as soon as possible.

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  • Tariq
    Sep 15, 2011 - 8:20PM

    Since Pakistan loves China so much maybe you can ask them for the money

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  • Asghar Khan
    Sep 15, 2011 - 9:48PM

    we are shameless!

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  • Asghar Khan
    Sep 15, 2011 - 9:49PM

    billions of dollors remitted back o pakistan , but my leaders need to beg !?

    shame on me!

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  • Huma
    Sep 27, 2011 - 11:44AM

    We don’t need to beg anyone for creating resources for our future. Pakistan is full of resources as COIL, OIL etc. We our selves can develop a mechanism to create electricity by our own!!

    Pakistan please wake up!!!!!

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