Consumers and industry alike are paying dearly for inadequacies of energy policies of successive governments that encouraged private sector entrepreneurs to produce their own power through gas run generators, only to pull the plug by denying them gas supplies.
It seems that all government policies are designed to fail in Pakistan because they are made on the whims of men in power. They announce policy measures without going into the pros and cons of the steps taken by them. A review of the government’s energy related policies framed during the last decade indicates that most policies have collapsed due to ad hocism and nepotism, but nobody is accountable for these failures.
During the previous regime, the economy grew at a rapid pace of over seven percent per annum, but one fine morning the country’s able economic managers announced that they had forgotten to project energy demand, leaving the people to grumble over the trickle-down that never materialised while the country struggled with acute energy shortage.
The entire government machinery – including Ministry of Petroleum and Natural Resources, Hydrocarbon Development Institute of Pakistan and gas utility companies – advocated natural gas as the only viable solution to the country’s energy problem. But again it turned out that our economic planners remained blissfully unaware of the true position of our natural gas reserves.
That the energy sector continues to be dogged by problems without any credible solution is indicative of the level of incompetence among relevant policymakers. The manufacturing sector is mired in boom and bust cycles, turning positive whenever power is made available. Power generation units are lying useless and compressed natural gas (CNG) stations are witnessing three-day weekly shutdown across Punjab. Yet the Ministry of Petroleum and Natural Resources websites proudly states, “Government is and has been promoting use of Compressed Natural Gas (CNG) to reduce pollution caused by vehicles using other fuels and to improve the ambient air quality.
A growing number of vehicles has been and are still being converted to CNG mainly due to the existing price differential between CNG and petrol. There are about 3,116 established CNG stations in the country and approximately 2.0 million vehicles are using CNG. Pakistan is now the largest CNG using country wherein an investment of Rs90 billion has been made, creating some 80,000 jobs.”
The present government took charge in 2008 and electricity and gas shortages were among its few early announcements, but Ministry of Petroleum and Natural Resource website still advocates, “Government’s policy of de-dieselisation is also being actively pursued whereby Public-Private Partnership based projects are being initiated for introduction of CNG based public transport within major cities. The provincial governments in this behalf are actively pursuing such projects to achieve import substitution. This program will have a major impact on air quality of urban areas and will improve health standards as well.”
The level of coordination among government departments is so deficient that despite the fact that the country has no gas for transport, both Punjab and Sindh governments have imported CNG-dedicated busses for public transport.
The private sector alone has invested some Rs200 billion in CNG equipment and installation. According to a conservative estimate, Pakistan has imported some $5 billion power generators during the last couple of years, which are mostly running on natural gas. But the irony is that now the country has no natural gas to run the wheels of this largest gas fired fleet, which will ultimately convert into scrap.
The industry has also invested huge amounts in gas-run power generation, but the entire industry is deprived of gas for two to three days a week, reducing productivity by 28 to 43 per cent. However, a newly established fertiliser plant has been guaranteed 100 MMCFD daily gas that is sufficient to run the entire textile sector. The government is protecting 1,000 workers’ jobs at the expanse of a 3.5 million strong workforce involved in textiles.
Civil servants and policymakers ask for market based salaries, which is a valid demand, but it should be linked with performance and accountability; otherwise the country would never come out of the present crisis. To a certain extent everybody in the country, including politicians, are accountable before the public, but apparently not policymakers playing with the fate of around 180 million people.
The writer is Commerce Reporter,
Pakistan Today
