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PIA has cut losses of Rs13.5bn this year: aviation adviser
This picture shows a Pakistan International Airline aircraft. — File photo
ISLAMABAD: Adviser to Prime Minister on Aviation Affairs Shujaat Azeem said on Friday that the annual loss of Pakistan International Airline (PIA) had been reduced to Rs18 billion from Rs31.5 billion during the previous year.
He said the PIA was also paying Rs3.29 billion interest on legacy loans that were taken in 1992.
Speaking to reporters in the federal capital, the premier's adviser said that 10 more narrow-body airbuses and five aircraft manufactured by French-Italian manufacturer ATR would be inducted in PIA by the end of December this year.
Induction of more aircraft would help boost PIA's performance which would assist in generating more revenue, Azeem said.
Praising the initiatives for the improvement of the national carrier, he said the government was working towards introducing a new aviation policy to discourage corruption within PIA.
PIA had received delivery of its eight A-320 aircraft acquired on long-term dry lease from General Electric, Azeem added.
He also said that the PIA has 25 operational airbuses and 11 ATR aircraft at present and increasing the number would also help overcome its financial difficulties.
New Islamabad airport close to completion
the airport is located at an area of 3,300 acres, with the length of 18.5 kilometres. STOCK PHOTO
ISLAMABAD:
More than 90% work on the new Islamabad International Airport (IIAP) has been completed and the facility is expected to become operational in October 2016, according to IIAP Project Director Civil Aviation Brigadier (Retd) Pervez Hayat Khan.
He was briefing a delegation of the Islamabad Chamber of Commerce and Industry (ICCI) led by its chairman, Muzzamil Hussain Sabri, on Thursday. He informed the delegation that the runways, roads and terminals were in the final stage of completion and it has been developed with the state-of-the-art facility with three times more passenger handling capacity, a four-story terminal and 15 boarding bridges.
Khan added that 99% work for laying transmission lines has been completed and a 135 megawatt grid station has also been built to provide electricity to the airport.
He said the airport is located at an area of 3,300 acres, with the length of 18.5 kilometres, while feasibility of three big dams was prepared to supply water to the facility. Khan said the initial development cost of the project was estimated at Rs38 billion, however, due to delays, its cost has increased to over Rs85 billion.
He hoped that the completion of this facility would give boost to business activities as it will promote trade and exports from this region. Speaking on the occasion, ICCI President Sabri appreciated the construction of a modern airport in Islamabad and said that a Facilitation Counter for businessmen should be established at the airport to provide them better services.
Resolving power crisis: Chalking a plan to set up power plants near gas fields
The proposed plan aims to enhance generation in order to curb power shortfall that ranges between 3,000 to 7,000 megawatts (MW). CREATIVE COMMONS
ISLAMABAD:
In a desperate attempt to overcome the persistent power crisis, the government is working on a plan to set up power plants near various gas fields to address the concern.
The proposed plan aims to enhance generation in order to curb power shortfall that ranges between 3,000 to 7,000 megawatts (MW). The country has been facing an acute shortage of electricity which stunts growth by around 3% every year, causing a huge number of industrial units to shut operations.
Official sources in the Ministry of Water and Power told The Express Tribune that the proposed policy to this effect will be presented to the Economic Coordination Committee (ECC) or the Council of Common Interest (CCI) for approval.
They said that for a continuous gas supply, the Ministry of Water and Power, along with the Petroleum Ministry, has agreed to set up power plants at various gas fields.
“Both ministries have agreed to carry out the bidding process for setting up power plants at the sites of the gas fields,” sources said, adding that the petroleum ministry would provide the specifications.
They said that the Private Power Infrastructure Board (PPIB) would carry out the bidding process subject to meeting legal requirements. A preliminary study including interconnection studies will be carried out by the power producer in consultation with the energy buyer.
The request for proposal shall be prepared in consultation with all the stakeholders including the respective distribution companies, which would then be approved by the National Electric Power Regulatory Authority (Nepra).
The concerned power distribution company (Disco), under whose jurisdiction the power plant will be located, shall sign the Energy Purchase Agreement (EPA) with the power producer.
The officials said that the EPA would be based on a take-and-pay basis (immediate cash payment method in order to avoid adding to the circular debt), tariff would be a single composite one without any capacity or fixed charges and Nepra shall provide a draft for a short and simplified EPA.
“There will be no contractual concessions or guarantees in the form of implementation agreement, or the sovereign guarantee by the government of Pakistan,” officials said, adding that the power regulator will determine and provide the benchmark tariff/reserve price prior to the issuance of the request for proposal to the bidders.
They said the payments to power producers would be either secured through an escrow arrangement, assignment of earmarked Disco receivables or some other priority payment arrangements.
“Nepra will issue generation licences and the approval of tariffs through international competitive bidding within 15 and 10 days, respectively,” officials said. “This proposed scheme of arrangement would be approved by the ECC or the CCI.”
A steering committee comprising officials of the power regulator, ministry of petroleum and other concerned departments of the power sector have been formed to work out the modalities for the transparent procurement of power from the proposed plants.
Power transmission lines: Blanket tax exemptions on investments for 10 years
Finance Minister Ishaq Dar chairing the meeting of Economic Coordination Committee at PM's office on Thursday. PHOTO: PID
ISLAMABAD:
The federal government has extended blanket tax exemptions on investments in the power transmission lines for a period of 10 years, while also rolling over loans worth Rs136 billion that were earlier obtained to retire the circular debt.
The decision to extend tax exemptions was taken by the Economic Coordination Committee (ECC) of the Cabinet and was aimed at attracting investments in the dilapidated transmission network of the country.
Headed by Finance Minister Ishaq Dar, the ECC also gave fresh sovereign guarantees to facilitate Pakistan International Airlines to borrow Rs12 billion and slapped 20% regulatory duties on the import of wheat.
It also increased margins of oil marketing companies on petrol and diesel along with dealer margins. The decision will result in a minimum 80 paisa per litre increase in petrol and diesel prices.
While considering a draft policy framework for the private sector transmission line projects, the ECC approved corporate tax exemption for 10 years with instructions that the companies concerned would file tax returns, according to a handout issued by the finance ministry.
The ECC allowed tax exemptions in turn over tax for a period of 10 years. Further, withholding tax on income was also exempted. However, the economic decision-making body decided that general sales tax on imports by investors would be adjustable.
Unlike the blanket tax exemptions to Independent Power Producers (IPP), the exemptions for the transmission line investors would be limited to only 10 years, said Federal Board of Revenue Chairman Tariq Bajwa. He said the tax on dividends will be 10% for transmission projects against 7.5% for IPPs.
The ECC directed the National Electric Power Regulatory Authority to finalise a tariff petition within a month for transmission lines without the re-opening of tariff obtained through international competitive bidding. The government is opening the transmission lines for the private sector for the first time.
Debt rollover
The ECC rolled over the syndicated term finance facility of Rs136.5 billion for another two years which was obtained two years ago to retire circular debt. The rollover will have no impact on the existing stock of the circular debt but it will increase burden on the budget on account of debt servicing cost. The government is paying interest rates to banks over and above the Karachi Interbank Offered Rates (Kibor).
The ECC also imposed 20% regulatory duty on wheat imports. The decision was taken to preserve foreign currency reserves.
The ECC was of the view that there was no justification for increasing imports as the crop yield for wheat in the country was reasonable, however, the decision is in violation to commitments given to the World Trade Organization.
Pakistan International Airlines
The ECC approved sovereign guarantees for facilitating PIA to obtain Rs12 billion in loans so that the national flag carrier can meet its critical requirements, the terms and conditions of the loans will be determined in consultation with the finance ministry. The increased lending to PIA has stretched National Bank’s balance sheet, according to officials.
Increase in margins for OMCs
The ECC increased the OMCs’ margin on petrol by 12 paisa and by 49 paisa on diesel while the dealers’ margin was increased by 30 paisa per litre. The move will increase the overall prices by about 80 paisa. The OMCs were taking Rs1.89 per litre margin on high speed diesel before the increase. The commission for dealers, currently at Rs2.30 per litre, has been proposed to be jacked up to Rs2.60 per litre.
The ECC approved a policy framework for on-site projects based on interim gas supply. The proposal is aimed at interim utilisation of over 200 million cubic feet per day (mmcfd) of natural gas available at various gas fields which cannot be injected into the pipeline system in the near future, due to the time required for the establishment of gas production.
Cadet College Larkana
This picture shows a Pakistan International Airline aircraft. — File photo
ISLAMABAD: Adviser to Prime Minister on Aviation Affairs Shujaat Azeem said on Friday that the annual loss of Pakistan International Airline (PIA) had been reduced to Rs18 billion from Rs31.5 billion during the previous year.
He said the PIA was also paying Rs3.29 billion interest on legacy loans that were taken in 1992.
Speaking to reporters in the federal capital, the premier's adviser said that 10 more narrow-body airbuses and five aircraft manufactured by French-Italian manufacturer ATR would be inducted in PIA by the end of December this year.
Induction of more aircraft would help boost PIA's performance which would assist in generating more revenue, Azeem said.
Praising the initiatives for the improvement of the national carrier, he said the government was working towards introducing a new aviation policy to discourage corruption within PIA.
PIA had received delivery of its eight A-320 aircraft acquired on long-term dry lease from General Electric, Azeem added.
He also said that the PIA has 25 operational airbuses and 11 ATR aircraft at present and increasing the number would also help overcome its financial difficulties.
New Islamabad airport close to completion
the airport is located at an area of 3,300 acres, with the length of 18.5 kilometres. STOCK PHOTO
ISLAMABAD:
More than 90% work on the new Islamabad International Airport (IIAP) has been completed and the facility is expected to become operational in October 2016, according to IIAP Project Director Civil Aviation Brigadier (Retd) Pervez Hayat Khan.
He was briefing a delegation of the Islamabad Chamber of Commerce and Industry (ICCI) led by its chairman, Muzzamil Hussain Sabri, on Thursday. He informed the delegation that the runways, roads and terminals were in the final stage of completion and it has been developed with the state-of-the-art facility with three times more passenger handling capacity, a four-story terminal and 15 boarding bridges.
Khan added that 99% work for laying transmission lines has been completed and a 135 megawatt grid station has also been built to provide electricity to the airport.
He said the airport is located at an area of 3,300 acres, with the length of 18.5 kilometres, while feasibility of three big dams was prepared to supply water to the facility. Khan said the initial development cost of the project was estimated at Rs38 billion, however, due to delays, its cost has increased to over Rs85 billion.
He hoped that the completion of this facility would give boost to business activities as it will promote trade and exports from this region. Speaking on the occasion, ICCI President Sabri appreciated the construction of a modern airport in Islamabad and said that a Facilitation Counter for businessmen should be established at the airport to provide them better services.
Resolving power crisis: Chalking a plan to set up power plants near gas fields
The proposed plan aims to enhance generation in order to curb power shortfall that ranges between 3,000 to 7,000 megawatts (MW). CREATIVE COMMONS
ISLAMABAD:
In a desperate attempt to overcome the persistent power crisis, the government is working on a plan to set up power plants near various gas fields to address the concern.
The proposed plan aims to enhance generation in order to curb power shortfall that ranges between 3,000 to 7,000 megawatts (MW). The country has been facing an acute shortage of electricity which stunts growth by around 3% every year, causing a huge number of industrial units to shut operations.
Official sources in the Ministry of Water and Power told The Express Tribune that the proposed policy to this effect will be presented to the Economic Coordination Committee (ECC) or the Council of Common Interest (CCI) for approval.
They said that for a continuous gas supply, the Ministry of Water and Power, along with the Petroleum Ministry, has agreed to set up power plants at various gas fields.
“Both ministries have agreed to carry out the bidding process for setting up power plants at the sites of the gas fields,” sources said, adding that the petroleum ministry would provide the specifications.
They said that the Private Power Infrastructure Board (PPIB) would carry out the bidding process subject to meeting legal requirements. A preliminary study including interconnection studies will be carried out by the power producer in consultation with the energy buyer.
The request for proposal shall be prepared in consultation with all the stakeholders including the respective distribution companies, which would then be approved by the National Electric Power Regulatory Authority (Nepra).
The concerned power distribution company (Disco), under whose jurisdiction the power plant will be located, shall sign the Energy Purchase Agreement (EPA) with the power producer.
The officials said that the EPA would be based on a take-and-pay basis (immediate cash payment method in order to avoid adding to the circular debt), tariff would be a single composite one without any capacity or fixed charges and Nepra shall provide a draft for a short and simplified EPA.
“There will be no contractual concessions or guarantees in the form of implementation agreement, or the sovereign guarantee by the government of Pakistan,” officials said, adding that the power regulator will determine and provide the benchmark tariff/reserve price prior to the issuance of the request for proposal to the bidders.
They said the payments to power producers would be either secured through an escrow arrangement, assignment of earmarked Disco receivables or some other priority payment arrangements.
“Nepra will issue generation licences and the approval of tariffs through international competitive bidding within 15 and 10 days, respectively,” officials said. “This proposed scheme of arrangement would be approved by the ECC or the CCI.”
A steering committee comprising officials of the power regulator, ministry of petroleum and other concerned departments of the power sector have been formed to work out the modalities for the transparent procurement of power from the proposed plants.
Power transmission lines: Blanket tax exemptions on investments for 10 years
Finance Minister Ishaq Dar chairing the meeting of Economic Coordination Committee at PM's office on Thursday. PHOTO: PID
ISLAMABAD:
The federal government has extended blanket tax exemptions on investments in the power transmission lines for a period of 10 years, while also rolling over loans worth Rs136 billion that were earlier obtained to retire the circular debt.
The decision to extend tax exemptions was taken by the Economic Coordination Committee (ECC) of the Cabinet and was aimed at attracting investments in the dilapidated transmission network of the country.
Headed by Finance Minister Ishaq Dar, the ECC also gave fresh sovereign guarantees to facilitate Pakistan International Airlines to borrow Rs12 billion and slapped 20% regulatory duties on the import of wheat.
It also increased margins of oil marketing companies on petrol and diesel along with dealer margins. The decision will result in a minimum 80 paisa per litre increase in petrol and diesel prices.
While considering a draft policy framework for the private sector transmission line projects, the ECC approved corporate tax exemption for 10 years with instructions that the companies concerned would file tax returns, according to a handout issued by the finance ministry.
The ECC allowed tax exemptions in turn over tax for a period of 10 years. Further, withholding tax on income was also exempted. However, the economic decision-making body decided that general sales tax on imports by investors would be adjustable.
Unlike the blanket tax exemptions to Independent Power Producers (IPP), the exemptions for the transmission line investors would be limited to only 10 years, said Federal Board of Revenue Chairman Tariq Bajwa. He said the tax on dividends will be 10% for transmission projects against 7.5% for IPPs.
The ECC directed the National Electric Power Regulatory Authority to finalise a tariff petition within a month for transmission lines without the re-opening of tariff obtained through international competitive bidding. The government is opening the transmission lines for the private sector for the first time.
Debt rollover
The ECC rolled over the syndicated term finance facility of Rs136.5 billion for another two years which was obtained two years ago to retire circular debt. The rollover will have no impact on the existing stock of the circular debt but it will increase burden on the budget on account of debt servicing cost. The government is paying interest rates to banks over and above the Karachi Interbank Offered Rates (Kibor).
The ECC also imposed 20% regulatory duty on wheat imports. The decision was taken to preserve foreign currency reserves.
The ECC was of the view that there was no justification for increasing imports as the crop yield for wheat in the country was reasonable, however, the decision is in violation to commitments given to the World Trade Organization.
Pakistan International Airlines
The ECC approved sovereign guarantees for facilitating PIA to obtain Rs12 billion in loans so that the national flag carrier can meet its critical requirements, the terms and conditions of the loans will be determined in consultation with the finance ministry. The increased lending to PIA has stretched National Bank’s balance sheet, according to officials.
Increase in margins for OMCs
The ECC increased the OMCs’ margin on petrol by 12 paisa and by 49 paisa on diesel while the dealers’ margin was increased by 30 paisa per litre. The move will increase the overall prices by about 80 paisa. The OMCs were taking Rs1.89 per litre margin on high speed diesel before the increase. The commission for dealers, currently at Rs2.30 per litre, has been proposed to be jacked up to Rs2.60 per litre.
The ECC approved a policy framework for on-site projects based on interim gas supply. The proposal is aimed at interim utilisation of over 200 million cubic feet per day (mmcfd) of natural gas available at various gas fields which cannot be injected into the pipeline system in the near future, due to the time required for the establishment of gas production.
Cadet College Larkana
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