Power sector close to collapse under Rs513.37 billion debt

ISLAMABAD: Amid the unprecedented power shortages of over 7,000MW, Pakistan’s power sector receivables have risen to a whopping Rs513.368 billion in the first 10 months of the current financial year 2013-14, threatening collapse of the entire system.
According to the latest documents on receivables as of April 2014 available with The News, the provinces are required to pay Rs87.256 billion that include Sindh’s Rs54.547 billion, KP Rs20.540 billion, Punjab Rs6.619 billion, Balochistan Rs5.550 billion and the AJK’s Rs36.693 billion.

The shocking fact is that the government has failed to collect electricity bills from private sector consumers as this sector has emerged as the biggest defaulter owing a mammoth Rs345.386 to the Pakistan Electric Power Company (Pepco).

The document also unveils that the domestic sector in Fata is required to pay Rs32 billion, which has also been included in the head of private sector consumers.

Finance Minister Ishaq Dar said that the government was going to implement a special plan next week to improve the recovery of electricity bills as the finance ministry had no money to clear the circular debt that had risen to over Rs300 billion.

The prime minister is worried and annoyed over the appalling situation of power sector and it is clear that the Ministry of Water and Power is bound to speedily recover these bills and clear the circular debt. However, the finance ministry will also depute a senior official to help the Ministry of Water and Power to recover the dues.

Dar said that he was going to soon pay more to the Ministry of Water and Power from the head of inter-tariff differential subsidy so that PSO’s imminent default could be averted.

Meanwhile, the IPPs have reduced their power generation by over 1,600MW despite the fact that they have the capacity to generate 8,500MW of electricity. They have reduced their generation just because of non-availability of the required liquidity. They have no money to pay the interest to banks on loans they have borrowed to purchase the fuel. The government owes Rs210 billion to the IPPs and if the situation continues unabated, then the IPPs may halt their operations exposing the country to more loadshedding, according to Adbullah Yousaf, the Chairman of Advisory Council of the IPPs.

Meanwhile, the Pakistan State Oil is on the verge of being declared a defaulter as one of its letters of credit (L/C) is going to expire on Friday, June 13.The dues of PSO have also swelled to Rs130 billion as of today that the power sector has to pay to the state-run entity.

“We have supplied furnace oil of Rs160 billion to the power sector by June 9, 2014 in the current financial year and in return PSO miserably lacks the liquidity as the power sector is not paying for the fuel it has used so far,” a senior official in PSO told The News.“This situation has exposed PSO with zero liquidity because of which it has no fiscal space to place more orders to import furnace oil for power generation.”

Two killed in Shanghai building collapse

Two persons died and four others were injured when an old residential building collapsed in China’s Shanghai city early on Sunday, a media report said.

The accident occurred at 4.47 am in Hongkou District. Five persons have been pulled out of the debris. Rescue efforts are under way, state run Xinhua news agency reported.

Meanwhile the death toll from a bridge collapse in south China’s Guangdong Province rose to seven after two persons succumbed to their injuries at a hospital.

The stone arch bridge in Liangkengkou village, Gaozhou City had collapsed on Saturday.

More than 300 rescuers pulled 26 people out of the rubble.

11 killed in south China bridge collapse

BEIJING: A stone arch bridge under illegal construction in a village in southern China collapsed, killing 11 people and injuring several others, state media and an official said Sunday.

Rescuers pulled out 26 people, mostly construction workers, after the bridge came down Saturday afternoon in Liangkengkou village in Guangdong province, according to an official at the information office of Maoming city government.

Five of them were confirmed dead at the scene. Eight others were seriously injured, six of whom died later in the hospital, said the man, who refused to give his name, as is common with Chinese officials. One person managed to escape the bridge collapse, he said.

He said that the village committee had arranged to build a new bridge over a waterless ditch, but failed to get permission. The local government ordered construction to stop several times, but villagers took advantage of the three-day May Day holiday from Thursday to Saturday to restart the work.

The Maoming government official said three people responsible for the project were in police custody. The village committee could not be reached Sunday. Photos on state media showed a steep slope with dozens of tumbled stones and planks of fallen wood, which had been used as scaffolding.

3 killed in Peshawar roof collapse

PESHAWAR: Three people including a woman and a child were killed when a roof of a house collapsed in Peshawar on late Sunday night, Geo News reported.

Rescue sources said that a couple and their child were trapped under the debris as the roof collapsed. They were recovered from the debris after hectic efforts and shifted to the Lady Reading Hospital where they succumbed to their injuries.

The incident took place in Sadar area of the provincial capital.