- Minister says govt already embarked on an entire economic or power sector reform as desired by China and IMF
ISLAMABAD: Power Minister Awais Leghari on Saturday revealed that Pakistan was embarking on a major renegotiation of its energy sector deals with China, aiming to achieve a more sustainable and cost-effective energy landscape.
“The focus of this review is on two key areas – debt reprofiling and coal sourcing”, Power Minister Awais Leghari outlined during an interview with a private channel.
“Pakistan has already embarked on an entire economic or power sector reform as desired by China and the IMF”, the minister stated.
He said that in debt Reprofiling, Pakistan is reviewing the terms of debt repayment with Chinese Independent Power Producers (IPPs), seeking to restructure the repayment schedule to alleviate the burden on the country’s finances.
“Similarly, we aim to shift from imported coal to locally sourced coal for power generation to potentially reduce energy costs and enhancing energy security”, he went on to say.
The minister emphasized that the renegotiation was aimed at achieving a mutually beneficial outcome for both Pakistan and Chinese investors, ensuring continued investment while addressing Pakistan’s needs.
“The investments made by Chinese IPPs are under a government-to-government (G2G) framework, which enables this review process”, the minister pointed out, claiming the review and study were being conducted collaboratively with the Chinese government, fostering a spirit of cooperation.
The minister emphasized: “The review goes beyond just IPPs, encompassing the entire power sector, including government-owned plants, ensuring a holistic approach to energy reform.”
He said that a task force with experts had been formed to conduct the study, ensuring technical expertise and a thorough analysis.
“It’s going to be a win-win situation for everyone,” he underscored.
“We are not beginning but have already begun the review together with the Chinese government in debt reprofiling and coal conversion to local coal.”
“We are reviewing and studying the overall landscape of the power sector’s entire generation, including IPPs and government-owned plants.”
“We have already begun reviewing them (IPP contracts) from two different angles — one is debt reprofiling and the other is of the investments they made to produce energy through imported coal.”
“We have begun conducting its study together with the Chinese from only these two angles. Working groups have also been established to do the same.”
