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DAWN News: Article: Bureaucracy stalls $800m hydel project
By Khaleeq Kiani
Monday, 21 Dec, 2009
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Bureaucratic wrangling meant that the hydel project was shelved.— Photo from Reuters/File
ISLAMABAD: Amid a controversy over expensive rental power projects, a $800 million foreign investment for cheap hydroelectric power generation is unlikely to materialise mainly because of bureaucratic wrangling, despite full support extended by federal and Azad Kashmir governments.
This comes at a time when the federal government is finding it difficult to lure foreign investment to meet growing energy shortfalls and is approaching world capitals to secure supplies of oil, natural gas and liquefied gas for power generation at much higher prices, involving massive outflow of foreign exchange.
Background interviews and official documents available with Dawn suggest that after pursuing the 500-MW Mahl power project at home and abroad for almost four years now, the process ‘has been stopped altogether.’
The sources said Korea’s leading public sector investors, after having paid relevant government fees and other expenses, were literally running from federal to AJK governments through direct and diplomatic channels seeking permission to proceed with the construction of 500-MW Mahl Hydropower project for which they had been selected by the government through international competitive bidding.
The main hurdle, the sources said, was that a senior official of the federal government, who would be reaching retirement age soon, wanted the $800 million project on the River Jhelum in Azad Kashmir to be developed in the public sector so he could become the project director.
Informed sources said that senior bureaucrats were clearly changing their goal posts and have now informed the Korean investors that the government had failed to finalise relevant procedures under the power policy announced in 2002 and under which they had called international bids and made selections.
