Business

K-Electric gets highest federal subsidy of Rs169bn

Published

1 year ago

Farwa

KE subsidy is being fulfilled by federal budget.
Iesco, Lesco and Fesco subsiding other Discos.
KE says gas supply to captive power plants be stopped.

ISLAMABAD: The federal government is providing the highest subsidy to K-Electric as compared to the state-run Power Distribution Companies (Discos), it emerged Wednesday.

According to the Ministry of Energy (Power Division) statistics, the net required subsidy of K-Electric is Rs169 billion and is being fulfilled by the federal government budget.

Among the Discos, three are Islamabad Electric Supply Company (Iesco), Lahore Electric Supply Company (Lesco) and Faisalabad Electric Supply Company (Fesco), which are subsidising the remaining seven Discos with a total amount of Rs156 billion per annum, Federal Secretary of Power Division Rashid Mahmood Langrial told The News.

The share of Iesco is Rs68 billion, Lesco Rs83 billion and Fesco Rs5 billion as cross-subsidising the other companies (except K-Electric).

The three do not need to take subsidies from the federal government.

Besides, the federal government is also subsidising the consumers of other Discos with a combined subsidy amount of Rs158 billion, a bigger amount than what it subsidises the K-electric with Rs169 billion.

Iesco, for instance, stands out as a self-sufficient entity, generating a cross-subsidy of Rs112 billion, which comfortably covers its Rs44 billion subsidy requirement. Lesco follows suit, generating Rs201 billion as it needs Rs118 billion for subsidies, leaving them financially robust.

Fesco demonstrates similar financial independence, generating Rs91 billion while requiring Rs86 billion in subsidies.

In stark contrast, the other seven distribution companies (Discos) face financial deficits and depend on federal subsidies as well as inter-discos cross-subsidies from Iesco, Lesco and Fesco.

Moreover, the Peshawar Electric Supply Company (Pesco) generates only Rs42 billion in cross-subsidies against a subsidy requirement of Rs77 billion, resulting in a net required subsidy of Rs35 billion.

This financial gap is bridged by Rs17 billion from inter-Discos subsidy transfers and Rs18 billion from the federal government.

Similarly, the Gujranwala Electric Company (Gepco) receives Rs18 billion through inter-Discos subsidy transfers and another Rs18 billion from the federal government.

The Tribal Electric Supply Company (TESCO) requires Rs19 billion subsidy, which is met by Rs10 billion from inter-Discos subsidies and Rs9 billion from the federal government.

Furthermore, the Multan Electric Power Company (Mepco) also demonstrates a reliance on subsidies, needing Rs86 billion in total, with Rs43 billion coming from inter-Discos subsidies and Rs43 billion from the federal government while the Quetta Electric Supply Company (Qesco) has subsidy requirement of Rs44 billion, with Rs22 billion each provided by inter-Discos subsidies and the federal government.

The Sukkur Electric Supply Company (Secpco) requires Rs25 billion in subsidies, with Rs12 billion sourced from inter-Discos subsidy and Rs13 billion from the federal government.

Meanwhile, Hyderabad Electric Supply Company (Hesco) has a subsidy requirement of Rs69 billion, with the federal government contributing Rs35 billion and the remaining Rs34 billion coming from inter-Discos cross-subsidy.

KE’s response

In response to Langrial’s statement, the power utility has clarified that the amount of subsidy goes back to the government institutions against the purchase of costly fuel.

“If KE gets the 276 mmcfd gas as approved by the ECC there wouldn’t be a need for any subsidy. Instead of captive or low-efficiency plants, the gas should be given to K-Electric.”

Natural gas supply to KE is currently suspended, it added.

Business

With its second-largest surge ever, PSX approaches 114,000 points.

Published

2 days ago

Farwa

Driven by renewed activity from both private and government financial institutions, the Pakistan Stock Exchange (PSX) saw its second-largest rally in history on Monday.

The market regained many important levels in a single trading session as it rose with previously unheard-of momentum.

Intraday trading saw a top increase of 4,676 points, and the PSX’s benchmark KSE-100 Index gained 4,411 points to settle at 113,924 points. This impressive rebound demonstrated significant investor confidence by reestablishing the 100,000, 111,000, 112,000, and 113,000-point levels.

The market also saw the 114,000-point limit reestablished during the trading session.

The positive tendency was reflected when the market’s heavyweight shares touched its upper circuits. Among the most busiest trading sessions in recent memory, an astounding 85.78 billion shares worth a total of Rs55 billion were exchanged.

Experts credited the spike to heightened institutional investor activity and hope for macroeconomic recovery. Considered a major market recovery, the rally demonstrated the market’s tenacity and development potential.

Business

In interbank trade, the Pakistani rupee beats the US dollar.

Published

1 week ago

Farwa

In the international exchange market, the US dollar has continued to weaken in relation to the Pakistani rupee.

The dollar fell to Rs278.10 from Rs278.17 at the beginning of interbank trading, according to currency dealers, a seven paisa loss.

In the meantime, there was a lot of turbulence in the stock market, but it recovered and moved into the positive zone. The KSE-100 index recovered momentum and reached 116,000 points after soaring 1,300 points.

Both currency and stock market swings, according to analysts, are a reflection of ongoing market adjustments and economic uncertainty.

Business

Phase II of CPEC: China-Pakistan Partnership Enters a New Era

Published

1 week ago

Farwa

The cornerstone of economic cooperation between the two brothers and all-weather friends is still the China-Pakistan Economic Corridor, the initiative’s flagship project.

In contrast to reports of a slowdown, recent events indicate a renewed vigour and strategic emphasis on pushing the second phase of CPEC, known as CPEC Phase-2, according to the Ministry of Planning, Development, and Special Initiatives.

According to the statement, this crucial stage seeks to reshape the foundation of bilateral ties via increased cooperation, cutting-edge technology transfer, and revolutionary socioeconomic initiatives.

Planning Minister Ahsan Iqbal is leading Pakistan’s participation in a number of high-profile gatherings in China, such as the 3rd Forum on China-Indian Ocean Region Development Cooperation in Kunming and the High-Level Seminar on CPEC-2 in Beijing.

His involvement demonstrates Pakistan’s commitment to reviving CPEC, resolving outstanding concerns, and developing a strong phase-2 roadmap that considers both countries’ long-term prosperity.

At the core of these interactions is China’s steadfast determination to turn CPEC into a strategic alliance that promotes development, progress, and connectivity.

Instead of being marginalised, CPEC is developing into a multifaceted framework with five main thematic corridors: the Opening-Up/Regional Connectivity Corridor, the Innovation Corridor, the Green Corridor, the Growth Corridor, and the Livelihood-Enhancing Corridor.

With the help of projects like these, the two countries will fortify their partnership, and CPEC phase-2 will become a model of global economic integration and collaboration that benefits not just China and Pakistan but the entire region.