ISLAMABAD, Aug 26 (APP): Ahsan Zafar Bakhtawari, President, Islamabad Chamber of Commerce and Industry (ICCI) said that the root cause of the surging circular debt and rising power tariffs was the power purchase agreements (PPAs) signed with the International Power Producers (IPPs). He called upon the government to revisit PPAs with IPPs to pay them in local currency, said a press release issued here on Saturday.

Talking to media at the Chambers House, the President ICCI said that IPPs were earning huge profits in dollars, but the businesses were badly suffering due to exorbitant power tariffs and the rising cost of doing business.
He stressed that the government should change the basic tariff of IPPs in PKR instead of US dollars as this change would save billions of rupees of the national exchequer and provide electricity at affordable cost to the businesses making our export competitive in the international market. Similarly, the profits to the IPPs should also be paid in local currency instead of US dollars, he said.

Faad Waheed, Senior Vice President ICCI said that around 47 IPPs were working in Pakistan’s power sector and they had already earned huge profits as compared to their capital investment. As per Power Policy 1994, 16 IPPs had invested around Rs.60 billion and earned over Rs.400 billion, which shows their huge profits in Pakistan, he said.

He said that PPAs in Pakistan had made energy cost highest in the region and stressed that to save the industry, the government should renegotiate PPAs with IPPs in the best national interest.

Zafar Bakhtawari, former President ICCI and Secretary General UBG said that due to the significant depreciation of rupee, the import of industrial raw materials had become very expensive which was pushing up the production cost.

He stressed that the government should take urgent measures to stabilize the value of rupee in order to save the industry from further troubles.

He said that instead of hiking the power tariffs, the government should focus on controlling the transmission and distribution losses and power theft besides improving the performance of power companies to save the consumers from further burden.