‘Wapda, KESC, PIA white elephants’

ISLAMABAD: The government on Sunday termed Water and Power Development Authority (Wapda), Karachi Electric Supply Corporation (KESC) and PIA as ‘white elephants’, as despite receiving billions of rupees in subsidies from the national kitty, their performance had been dismal.

“These white elephants have eaten up billions of rupees. We could have spent these funds on health, education and other social sectors. Despite the subsidies, their performance is unacceptable,” Dr Salman Shah, Economic Advisor to the Prime Minister on Finance, said this at the post-budget briefing here.

To a question, Salman Shah replied, “If we do not subsidize these institutions, it will affect the common man even more”. Several questions were raised about the poor performance of the KESC during the last couple of years, especially this year.

KESC, which supplies electricity to Karachi, the economic hub of the country, is charging four times more than Wapda. However, it has failed to provide electricity to its consumers. Both entities have flaws in transmission and distribution systems and have failed to match their performance to international standards. The deficiency results in frequent power breakdowns and line losses, which negatively affect the economic activities and, ultimately, the GDP growth.

About Pakistan International Airlines (PIA), Salman Shah said that Boeing passenger planes, which were added to the PIA fleet in the 90s, had become ‘gas-guzzlers’ and their running expenses were more than their earnings.

Interestingly, in the outgoing fiscal year 2006-07, the government had allocated Rs 20.93 billion subsidies for Wapda that was later revised upward by 19.1% to Rs 24.92 billion. In the upcoming new fiscal 2007-08 starting from July 1, another huge subsidy of Rs 27.89 billion for Wapda is on the cards, he said.

Two months back, in a meeting on energy crisis, Minister for Water and Power Liaquat Ali Jatoi had accused Wapda of mismanagement, causing loadshedding of over 1,100 MW while its units at eight stations remained closed for minor faults.

During the financial year 2006-07, KESC was subsidized up to Rs 13.938 billion, which was revised, and raised by 26.98% to Rs 17.69 billion at the end of the outgoing fiscal. In the new budget 2007-08, the government has earmarked another Rs 19.596 billion to shoulder the crisis that has engulfed the KESC. Salman Shah said that in the next five years, the government would bring some drastic reforms in the power sector to enhance its production.