Comment by Riaz Haq on May 14, 2018 at 8:14pm

Country’s (Pakistan's) installed electricity capacity increases by 30pc to 29,573MW

https://www.thenews.com.pk/print/309535-country-s-installed-electri...

Economic Survey 2017-18 unfolds that Pakistan’s installed capacity to generate electricity has surged up to 29,573MW by February 2018 which stood at 22,812MW in June 2013, showing the growth of 30 percent.

As far as the transmission and distribution losses are concerned, the Economic Survey says average losses were at 18.9 percent in 2013 which have now reduced to 17.9 percent in 2018 showing the government has succeeded to reduce the losses by 1 percent.

The recovery of the billed amount of electricity sold to the consumers stood at 89.6 percent. During the period from 2013 to 2018, as many as 39 projects with cumulative capacity of 12,230MW have been added. Due to significant improvement in the energy mix, the country’s reliance on expensive oil has been reduced.

The better energy supply has helped large scale manufacturing (LSM) and in turn manufacturing to both grew above 6 percent in FY 2017-18, which is an 11-year high. In power sector, per capita electricity consumption is considered one of the most important economic welfare indicator regarding availability of affordable energy. Pakistan is bestowed with enormous hydro and coal potential which, if carefully exploited, can ensure our future energy security on long-term basis. Further, the expansion in generation capacity requires supporting expansion in the transmission infrastructure for evacuation of the power.

China-Pakistan Economic Corridor (CPEC) is another major breakthrough in the development of the country’s energy sector, under which financial outlay of around $35 billion has been made for energy sector projects including power generation and transmission projects to be implemented in IPP mode. In case of natural gas, the gap between demand and supply was widening due to increase in gas demand and depletion of existing sources.

The government has made efforts to exploit indigenous resources as well as import gas though transnational pipelines and LNG to mitigate the shortfall. Indigenous crude oil meets only 15 percent of the country’s total requirements, while 85 percent requirements are met through imports of crude oil and refined petroleum products. The indigenous and imported crude is refined by six major and two small refineries. The present government not only made concerted efforts for upgradation of existing refineries, but also made addition of six depots with inland freight equalisation margin. Further, to promote fuel efficiency, the government has introduced marketing of 92 RON premier motor gasoline replacing the existing 87 RON PMG under the regulated environment.

Pakistan has large indigenous coal reserves estimated at over 186 billion tons which are sufficient to meet the energy requirements of the country on long-term basis. There has been significant increase in import of coal due to commissioning of new coal based power plants at Sahiwal and Port Qasim.

Comment by Riaz Haq on May 14, 2018 at 8:15pm

India’s Power Mess Is Enron Times 20
Banks are on the hook for $26 billion in loans to stressed electricity projects.


https://www.bloomberg.com/view/articles/2018-05-14/india-s-latest-p...



Enron Corp. is long gone, but the scandal it left behind in India has beguiled the country’s lenders for almost two decades.

However, if the bankers who financed the U.S. energy company’s unviable power plant in Maharashtra state aren’t ruing that 2,000-megawatt debacle any more, it’s only because they’re now staring at a mess 20 times bigger.

India’s total electricity-generation ability is 344,000 megawatts, a 72 percent increase over six years. The country, notorious for its outages, still doesn’t have a power surplus. But coal-fired plants in the private sector that ran at 84 percent capacity utilization at the start of the decade are struggling to stay alive with load factors of 55 percent. As much as 40,000 megawatts of capacity — equal to 20 Enron plants — has become stressed assets for the banking system.

Struggling to Stay Open
Capacity utilization of India's coal-based power plants in the private sector has collapsed

Lenders, on the hook for $26 billion, are yet to classify these exposures as nonperforming, let alone provide for losses out of (their increasingly nonexistent) profits. However, now that the central bank is forcing them to clean up their act, they’re trying to think of creative solutions. According to BloombergQuint, the banks will convert debt that’s unsustainable into equity and sell those shares to a jointly owned asset management company. The AMC will hawk its controlling stakes in power producers after a turnaround.

A better idea may to be to fix the underlying profitability of the power business. 

Forget long-term power purchase agreements. State utilities are shy to sign such contracts anyway and prone to ditch them at the first hint of cheaper electricity in the wholesale market. Let most of the demand and supply move to exchanges with open access for all bulk buyers and sellers, says Hemant Kanoria, chairman of India Power Corp., a 99-year-old company involved in both electricity generation and distribution.

The share of power trading in the country’s overall demand-supply equation has been stagnant for years at about 10 percent. This needs to change. 

The other big issue, as Kanoria rightly notes, is coal. India has no shortage of the fuel, but its dominant miner, which met 95 percent of its 600 million ton production target last year, needs to crack the whip on underperforming subsidiaries.

Power plants’ coal inventories are falling, and linking domestic availability to whether a producer has a long-term electricity purchase agreement with a state utility isn’t helping. Rather than continue with a less-than-satisfactory auction system, let Coal India Ltd. fix a price at which it would assure supply to whoever is willing to pay and take away the feedstock.

Running Low
Despite massive growth in India's power capacity, coal inventory at electricity plants is below this decade's average

Finally, financing costs, which have ballooned to half of the total expense of putting up a power plant, need a tweak. Restructuring unserviceable loans into other instruments — such as preference shares — would give producers some breathing room, Kanoria says. 

It’s silly of lenders to expect that debt with annual interest rates of 16-percent-plus won’t eventually turn bad. Dragging borrowers to the bankruptcy tribunal won’t solve anything. Most assets would sell for scrap value; jobs would be lost. Sweeping the problem under the carpet of an asset management company may preserve employment, but the immediate financial hit to banks could upset their already weak capital position. Besides, if existing owners are booted out, who will run the plants?

It was relatively easy to leave Enron’s Indian unit in the care of a couple of state-run companies, as the government did in 2005. That can’t be a template for a problem 20 times larger.

Comment by Riaz Haq on May 17, 2018 at 7:10am

Pakistan’s external debt soars to record $91.8b
By Shahbaz Rana /

https://tribune.com.pk/story/1711866/2-pakistans-external-debt-soar...

Pakistan’s external debt and liabilities have soared to a record $91.8 billion, showing an increase of over 50% or nearly $31 billion in the past four years and nine months, the State Bank of Pakistan (SBP) has reported.

The external debt and liabilities of $91.8 billion as of March-end suggest that the figure may touch $100 billion very soon as the country faces grave challenges in meeting growing external financing requirements. Pakistan is scheduled to make some bullet debt and interest payments in the last quarter (April-June) of the current fiscal year, according to sources in the finance ministry.

The $91.8-billion external debt and liabilities were higher by $30.9 billion or 50.6% compared to the level recorded in June 2013 when the Pakistan Muslim League-Nawaz (PML-N) government came to power.

Of the total external debt and liabilities, the government’s public debt obligations including foreign exchange liabilities were $76.1 billion at the end of March.

In the past four years and nine months, the public debt-related obligations increased 42.5% or $22.7 billion, showed the central bank data. In June 2013, the external public debt including foreign exchange liabilities stood at only $53.4 billion.


A major hike came in the external debt contracted by issuing sovereign bonds and taking expensive commercial loans.

Since June 2013, the PML-N government has acquired a whopping $42.6 billion in external loans, which is taking its toll on the national exchequer due to the mounting debt servicing cost.

Starting from July 2013, with every passing year, the quantum of external debt has kept growing due to the government’s inability to implement policies that could have ensured sufficient non-debt creating inflows.

The International Monetary Fund (IMF)’s first post-programme monitoring report shows Pakistan’s gross external debt in terms of exports was 193.2% in 2013, which is projected to deteriorate to an alarming 316% in June this year.

During this period, Pakistan’s gross external financing requirements have swelled from $17.2 billion to $24 billion.

Comment by Riaz Haq on May 17, 2018 at 8:39am

#Pakistan signs contract for construction of 878km 600KV HVDC #power #transmission line from Matiari in #Sindh to #Lahore. #CPEC #China @steelguru #SteelGuru

https://steelguru.com/power/pakistan-signed-for-construction-of-878...

Pakistan Today reported that Pakistan Prime Minister Shahid Khaqan Abbasi witnessed signing of agreements between Power Division of Pakistan and State Grid Corporation of China, for construction of 878 kilometres 600 KV HVDC Bipole Transmission Line from Matiari to Lahore. The signing ceremony was held here at the PM House.

Under the agreements, which are part of the Pakistan China Economic Corridor, two Convertor Stations with AC Switching Stations at Matiari and Lahore; two Electrode Stations at Matiari & Lahore each and three Repeater Stations along the route of the line will also be constructed.

During the briefing about the agreements, the prime minister was informed that with the launching of “China Pakistan Economic Corridor” energy portfolio, planning for evacuation of power from the upcoming power plants, including Thar, Port Qasim, nuclear and at Hub, became a challenge for NTDC.

Accordingly, HVDC Transmission Line was planned under CPEC for which Cooperation Agreement was signed in 2015 between NTDC and State Grid Corporation of China.

This flagship project is first of its kind in Pakistan and also the first being executed under the Government of Pakistan Transmission Policy-2015 on Build, Own, Operate and Transfer basis for 25 years.

The project has a completion time of 27 months and Commercial Operation Date has been fixed at March 1, 2021.

Project Implementation Agreement (IA) was signed by MD PPIB and Shu Yinbiao, Chairman of State Grid Corporation of China while Transmission Service Agreement, Land Lease Agreement, O & M Agreement was signed by Shu Yinbiao from the Chinese side and MD NTDC on behalf of the Power Division.

Comment by Riaz Haq on June 5, 2018 at 10:36am

Punjab Chief Minister Shahbaz Sharif claims PMLN worked tirelessly and delivered in several sectors.


https://arynews.tv/en/bore-accusations-delivered-shehbaz-sharif/


He said Punjab invested in the setting up power projects, and the entire country benefited. He said their government invested Rs150 billion in power projects, and although it was not their responsibility, electricity was provided to the whole nation.

“We have always believed in the notion that investment of Punjab, and power to entire Pakistan,” he said adding that it was the goodwill gesture that entire nation should benefit from it.

He said that patients were compelled to seek treatment in India, and were not even issued visas, which was rather shameful for them. Therefore, the government set up new medical colleges and hospitals so that kidney and liver transplantation procedures can be performed within the country.

“In a couple of days, transplantation machinery will arrive in Pakistan. Don’t go to India anymore. We have beat them in transplantation, and we have to fight and defeat them economically,” he said.

He said the Pervez Musharraf duped the country by just laying the foundation stone of Basha Dam in 2007, while it was their government who released billions to purchase the lands. He vowed that, if given the opportunity, they will win the case for water with India.

He said that public transport is the hallmark a society, which was in shambles and citizens couldn’t reach in old dilapidated buses. Therefore, they provided cost-efficient and effective metro buses and Orange Line services.

He said the KP government, which criticised the Lahore metro service previously, is now setting up but has instead ruined the city. “This is their planning. What will they do for the economy, exports and providing employment,” he said lashing at the now dissolved PT-led government.

He said the Peshawar High Court had taken notice of the matriculation results last year, and children in the province were forced to work in brick kilns. “KP, Sindh, and Balochistan’s children are working on brick kilns,” he said.

He said the Punjab provided interest-free loans to over two million youth worth Rs40 billion. “Tell me which province has potential to set up small dams and hydel power? KP, but they produced minus six megawatts electricity,” he said.

While on the other hand, he said the Punjab government produced 5000 megawatts and saved Rs682 billion, and even reduced cost by billion by the lowest bidder, and returned it in form of money or natural resources, which is unprecedented by any government since 1947.

“I swear in the month of Ramazan, each and every penny is well accounted for. The achievements of the PML-N are being left to the people.”

Shehbaz Sharif even credited his government for handing over Karachi to the Rangers, and making the critical decision in 2014 to ensure peace and metropolis. He said that law-enforcement agencies have rendered tremendous sacrifices, and even fortified the border area in South Waziristan to ensure peace.

Comment by Riaz Haq on June 10, 2018 at 10:01am

#Pakistan’s #trade deficit touches record high of $34b in July-May FY18. #Imports $55.3 billion, up 14%. #Exports $21.32 billion, up 4.7% from last year. https://profit.pakistantoday.com.pk/2018/06/09/pakistans-trade-defi... … via @Profitpk

Pakistan’s trade deficit clocked a record high of $34 billion during the eleven months of the outgoing financial year 2017-18.

This poses a major challenge for the next government to rein in the widening current account deficit as trade deficit increased 13.3 percent for the first eleven months (July-May) of FY18, according to official data, reported Dawn.

In May, the trade deficit increased to $3.76 billion posting an 8.6 percent year-on-year (YoY) increase.

The last FY17 had witnessed trade deficit to a then-record high of $32.58 billion, surging 37 percent from the previous FY16.


Imports clocked in at $55.3 billion, posting a 14 percent rise during July-May FY17 compared to $48.54 billion in the corresponding period of last year.

The import bill posted a 15 percent on a month-on-month basis, touching $5.9 billion in May against $5.09 billion in April 2018.

The commerce ministry said the imports in May had exhibited an increase mainly because of high oil prices and rise in volumes of imports of fuels and machinery to overcome energy deficit.

The total increase in imports during July-May FY18 was around 14 percent compared to corresponding last FY17.

The increase in import bill was attributed to an increase in arrival of petroleum products, food products and capital goods.

And exports continued their recovery which started early last year. Exports exhibited figures of above $2 billion for the third month running since March 2018 and during May it posted an increase of 32 percent year-on-year compared to same month last year.

The highest ever month-on-month (MoM) increase was posted in dollar terms as export proceeds rose to $2.14 billion in May 2018 against $1.62 billion in May 2017.

Yearly export growth reached 15 percent for July-April FY18 compared against 14 percent in the corresponding period of last year.

Overall exports in July-May FY18 touched $21.32 billion, which is roughly $1 billion more than annual figures for FY17.

During May, the merchandise exports earned Rs247.5 billion for the national exchequer against Rs169.7 billion earned in the corresponding period of last year.

This reflects additional revenues of roughly Rs80 billion for exporters in May 2018 which translates to a major gain of 46 percent.

Comment by Riaz Haq on June 26, 2018 at 4:12pm

The benchmark projections of poverty by country imply a high speed of poverty reduction in South Asia, East Asia and the Pacific, fueled by the high rates of income per capita growth in India, Indonesia, Bangladesh, Philippines, China and Pakistan. 


https://www.nature.com/articles/s41599-018-0083-y 


The benchmark projections of poverty by country imply a high speed of poverty reduction in South Asia, East Asia and the Pacific, fueled by the high rates of income per capita growth in India, Indonesia, Bangladesh, Philippines, China and Pakistan. Substantial reductions in poverty in Sub-Saharan Africa are only observable from 2020 onwards. Education expansion in Ethiopia, Kenya, Mozambique, Tanzania and the Democratic Republic of Congo as embodied in the population projections in Lutz and KC, (2017), is expected to be the main factor responsible for such a development. It should be noted that the narrative of the benchmark SSP2 scenario implies worldwide income convergence trends over the present century and thus represents a relatively optimistic view of future economic development, in particular in Sub-Saharan African countries. Addressing potential changes in poverty in the context of more pessimistic scenarios appears thus as a necessary complementary exercise to address the future of worldwide poverty dynamics and understand the risks associated to the fulfillment of the SDGs.

Changes in global poverty for the period 2023–2030 differ strongly across scenarios based on the different SSPs (Fig. 3), with the projection for SSP5 leading to approximately 377 million persons living in extreme poverty by 2030 and that of SSP3 reaching more than 506 million (see Table 1). The largest differences in poverty figures across scenarios tend to be concentrated in Sub-Saharan African countries. As compared to our benchmark SSP2 scenario, by 2030 the number of persons living in poverty in Nigeria implied by SSP3 would be higher by 15 million and the poverty rate would be almost 4.5 percentage points larger. In addition to Nigeria, the Democratic Republic of Congo, Tanzania, Uganda and Burkina Faso present the largest differences in the absolute number of poor individuals when comparing the benchmark poverty projections with those from the pessimistic SSP3 scenario. Compared to the benchmark scenario, the projections from the SSP3 scenario imply that four additional countries (Bolivia, Colombia, Ethiopia and Mauritania) would not be able to meet the SDG goal of eradicating poverty by 2030. The differences in population living in extreme poverty by country between the SSP2 (benchmark) and SSP3 (pessimistic) scenarios are presented in Fig. 4. The scenarios imply decreases in worldwide poverty rates by almost three percentage points in the most optimistic scenarios, around two percentage points in the benchmark SSP2 projections and slightly above one percentage point in the case of the pessimistic SSP3 and SSP4 scenarios. As measured by poverty rates, the absolute differences across scenarios are the largest for the African continent, with the SSP5 scenario projecting a poverty rate of approximately 20% in 2030 as compared to the SSP4 projection, with implies a poverty rate of almost 26% for the same year.

Comment by Riaz Haq on July 11, 2018 at 4:29pm

Building a new Pakistan

by Dr. Atta ur Rahman

https://www.thenews.com.pk/print/340110-building-a-new-pakistan

The single biggest opportunity to develop Pakistan lies in its 100 million people who are below the age of 20. We need to focus on their development to build a new Pakistan.

The country has abundant natural resources, the fifth largest river system in the world, which could be a huge source of cheap, and clean hydel power. Similarly, we have ample reserves of coal, as well as areas in Sindh and Balochistan that are suitable for wind energy projects. Given an honest and sensible government, we could have been producing energy at an average price of less than Rs3 per kilowatt hour.

However, the country has been eaten away by corrupt leaders who have built palaces abroad and accumulated mountains of wealth in the UK, UAE, Switzerland and many other countries, while the industry in the country lies devastated – with exports stagnating at about $21 billion annually. If we can produce energy at such low rates (as is already being done in the UAE through solar farms) we can hugely boost our industrial production, resulting in the expansion of the industry and provision of jobs to our qualified youth.

The second area that we can tap into is the IT sector. There is a worldwide demand for software for a variety of applications, particularly due to the fast emergence of machine intelligence. These applications are finding use in a number of businesses. We need to tap into this fast-growing source of wealth by setting up a network of high quality training centres in the country for IT graduates so that their skills can be honed to meet the demands of businesses. The global IT market has risen to about $1,400 billion, with a significant increase in the last couple of years, particularly in the software development sector.

The advent of the Fourth Industrial Revolution has opened up a number of exciting opportunities for Pakistan’s youth, provided that they are properly trained. The rise of artificial intelligence and its integration into almost every sphere of human activity has created unprecedented opportunities for our youth. New and more powerful computers are being developed that will be able to take over many conventional jobs and lead to an expansion in some fields. Most industrial assembly plants will no longer require humans as their functions will be taken over by intelligent bots. This has opened up fantastic opportunities for IT professionals capable of developing powerful algorithms to tackle specific industrial and service requirements.

Free or low-cost legal and medical advice is already being given by IBM’s computer, aptly named Watson. Before long, lawyers, judges, doctors, nurses, restaurant waiters, film actors and other professionals will be replaced by intelligent bots. Autonomous vehicles driven by computers will replace 95 percent of the vehicles on our roads, drastically reducing accidents. Most automobile manufacturers will go out of business as there will be no need to have personal vehicles with the availability of cheap and efficient autonomous taxi services.

Therefore, machine intelligence is one area to which our government must give the highest priority, by setting up centres of excellence in every university to meet the growing demands of high-quality professionals in this field. The transition from vehicles powered by combustion engines to electric vehicles is also occurring at a fast pace. This is creating research and development opportunities for our youth in the field of electric batteries.

Bioinformatics is another exciting field that our youth should be trained in as it is linked to genetic engineering. The ability to process large genomics data with powerful computing systems and to analyse it in order to arrive at meaningful conclusions will impact the health and agriculture sectors. New plant and animal species are already being developed with exciting properties, and the demand for suitably trained youth in this field will grow at an accelerated pace.

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