ISLAMABAD: The government of Khyber-Pakhtunkhwa has asked the federal government to increase its share in net profits earned by Islamabad from hydropower generation in the province, an official told The Express Tribune.
“We have asked the federal government to increase our share annually by 10 per cent in accordance with the National Finance Commission (NFC) award of 1991-92,” the official said but requested not to be named.
The province has been demanding an increase of 10 per cent on the initial Rs6 billion cap for the last eight years but to no avail, the official regretted and said K-P wants the increase to be made with retrospective effect.
Provincial finance secretary Sahibzada Saeed Ahmed confirmed that the K-P government has sought an increase in its share of net profits from hydropower. “We have told Islamabad that Rs6 billion is not acceptable to us.”
In the beginning, Khyber-Pakhtunkhwa was paid Rs6 billion, based on provisional profits of Wapda calculated for 1990-91, as net hydel profit in 1991-92 under the NFC award during the ANP-PML-N government. An annual increase in net profits at the rate of 10 per cent for the following years was also guaranteed in the award.
However, the federal government later capped the amount at Rs6 billion for subsequent years. “We have asked the Centre to lift the limit,” the finance secretary said.
He said electricity tariff has risen manifold since 1991 but K-P’s share has remained frozen, adding the province is grappling with financial hardships, caused mainly by the delay in increase in hydel profits. Besides, high inflation and rupee depreciation have also reduced the value of the amount.
The secretary expressed the hope that the federal government will look into the issue and brushed aside the impression that it will spark a row between the federal and provincial governments.
Published in The Express Tribune, November 11th, 2010.