ISLAMABAD—The Cabinet which met here Wednesday with Prime Minister Raja Pervez Ashraf in the chair was informed that the government has provided Rs464 billion subsidy to power sector, Rs 45 billion higher than the budgeted target of Rs419 billion for 2011-12.
Minister for Information Qamar Zaman Kaira told media after the meeting of the Cabinet that the government has provided Rs 464 billion subsidy on electricity during last fiscal year. He said the Cabinet meeting was also briefed about power situation as well as steps taken to mitigate the problem. Officials of Water and Power Ministry informed the meeting that electricity generation has improved recently, following increase in hydel generation as well as increase in fuel supply to power plants.
The meeting was informed that presently the daytime electricity production is 13,250 MW which increases to 14,300 MW in the evening with 5,000MW daytime and 6,100MW hydel production in the evening due to extra release of water from dams after its storage during daytime.
The minister said power generation by Gencos stood at 1,900MW, IPPs 6,300MW and 300MW from Chashma nuclear power plants whereas one plant of 300MW would become operational tonight. He said second nuclear power unit that had developed some fault would become operational this evening as a result of which 300MW would be added to the system.
The minister said the Prime Minister also constituted a committee with Secretaries of Ministries of Water and Power; Petroleum and Natural Resources and Finance for holding meetings on day-to-day basis to monitor the electricity situation and resolve the issues faced by the power sector. The meeting, he said would regularly update the Prime Minister and the Cabinet on the progress and the relevant information would also be shared with the people.
Kaira said the Prime Minister also decided that an exclusive meeting of the Cabinet on water and power sector would be held after Eid to review the steps taken so far and adopt further measures to improve the electricity situation in the country. In reply to a question, he said recovery of electricity dues in Punjab are relatively better compared to other provinces.
The Cabinet was informed that inflation has come down as compared to 2008-09. The Consumer Price Index has decreased to 9.6% from 12.4 per cent a year ago with food inflation decelerating to 9.1% from 23.7%, non-food inflation to 9.2% from 18.4% and core inflation to 11.3% from 17.4%.
The minister said the meeting was informed that the inflation could have further come down if the provincial government capped retailers and dealers hoarding of essential commodities made for profiteering. However, the minister said an increasing trend was noted in the prices of onion and tomatoes which have gone up by 11.5% and 11.34% respectably in recently days, but expressed the hope that the trend would be reversed with the arrival of new crops from KP and Balochistan.
The high-ups of the Finance Ministry has reportedly presented a regional comparison of the prices to the Cabinet meeting and informed that prices of some items such as wheat, rice, sugar and petrol are on the lower side in Pakistan as compared to India, Bangladesh and Sri Lanka. He said reduction in inflation does not necessarily means reversal of prices to previous level and inflation has come down largely because of improvement in supply chain. The minister said prices of fertilizer and diesel are higher in Pakistan as compared to other regional countries because other regional countries provide subsidy on them.
He said that Pakistan has been providing huge subsidy on power sector. Rupees 464 billion subsidy was provided on electricity during last fiscal year, Rs 26 billion on fertilizers and Rs 2.5 billion to Utility Stores Corporation (USC) for providing subsidized essential items.
Additionally, he said prices of gas in Pakistan are relatively cheap as compared to international market and the government is providing direct financial support to the people through Benazir Income Support Programme (BISP).
He said the Cabinet approved the draft of the Equity Participation Repeal Bill 2012, allowed starting of negotiations with different countries for increasing cooperation in different sectors.