Import of Furnace Oil is no more unlawful in Pakistan:

on 03/07/2020

The government has taken a stern step to fulfill the demand for power supply, when it is much needed because or rise in temperature in all over the country. The Cabinet Committee on Energy (CCoE) has allowed importing the furnace which was banned by the same company to give relief to local refineries in January last year. According to this decision, Pakistan State Oil (PSO) will import around 195,000 tonnes of furnace oil, while already having 260,000 tonnesof furnace oil in the country’s reserve, and will be helpful to meet the demand of the country.             Apart from PSO Independent Power Producers (IPPs) are also allowed to import the furnace oil through PSO or other Oil Marketing Companies (OMCs) with approval from the power division. Whereas, the petroleum division is requested to facilitate the import of furnace oil by the IPPs ad OMCs by the power division. On the other hand, the power division is asked to issue NOC to their desired IPPs for arranging HSFO import so there will be no interruption in the supplies of furnace oil.

The country energy sector is in jeopardy

on 03/07/2020

Islamabad is facing a huge setback in the energy sector. The maximum usage of fuel is still unable to diminish the electricity load shedding from the country.  The private sector is continuously looking towards the government for the permission of LNG import, which is necessary to fulfill the demand of energy in private power plants, textile and CNG sector at almost half the price.

On the other hand, the power generation in Karachi has much improved due to the change in the source of re-gasified liquid natural gas (RLNG), which is now taken from Sui Southern Gas Company Ltd (SSGCL) rather than from Sui Northern Gas Company Ltd (SNGPL) and it has turned down the merit order of the National Transmission & Dispatch Company (NTDC).

The demand of LNG is rational and profitable instead of high-speed diesel for power generation according to The Independent Power Producers (IPPs). Whereas, the government is continuously losing its assets on expensive fuel, by giving the order to import furnace oil for the national grid and KE system.

The position of SNGPL is also in difficulty as it is not able to fulfill the need for fuel of Bhikki, Haveli Bahadur Shan, and Balloki, which is about 1320 megawatts each. It claims that SNGPL has to provide 80-150 million cubic feet of gas to Karachi.

Sources report that IPPs have been given intimation to prepare themselves for the usage of High-Speed Diesel (HSD). Although the demand for HSD is also increasing in the transport sector and its use in other sectors will create a chaotic situation in the country because after the increase in its use there will be only 9 days of stock will be left for the transport sector which is an alarming situation for the government. And it was not only about demand but also cost, the cost of HSD and furnace oil is also much higher and increasing the burden on the shoulder of its consumer, a common man.             This situation has triggered the protest, some IPPs has written a letter to the Ministry of Energy Omar Ayub Khan and has informed about the discrepancies due to the latest situation. They also informed him that the Central Power Purchasing Agency (CPPA) is continuously enforcing them to get ready the plants on HSD. Whereas, the electricity on diesel is not beneficial for the consumers. The comparison of diesel and RLNG is also provided by IPPs, according to the electricity on diesel cost the government Rs15-20 per kWh (unit) and if it was done on spot RLNG it would come down to Rs7-8 per unit, which is much more different and beneficial for the consumers. Another issue regarding HSD is the immediate payment, there is a significant decline in the recovery of billing amount due to Covid-19 and the increasing rate of HSD would aggravate circular debt status and also disturb the cycle of payment of CPPA and power plants.

Expo 2020 Dubai postponed to next year

on 01/07/2020

The 12-month postponement of Expo 2020 Dubai has been formally ratified by the Bureau International des Expositions (BIE) at its general assembly.
The World Expo awarding body announced that it had already received the two-thirds majority required form its 170 member states.
At its assembly in Paris, the BIE said the new dates of Expo 2020 Dubai have officially changed to October 1, 2021 to March 31, 2022.
It added that the six-month event will keep the name ‘Expo 2020 Dubai’.
The postponement came as a result of a request from the UAE government to change the dates following a meeting of the Expo 2020 Dubai Steering Committee, in which participating countries expressed their need to postpone the event in order to focus in the imminent challenges posed by the Covid-19 pandemic.
The request then went through BIE’s formal procedures, which included examination by its own executive committee and a subsequent voting process.
“While this situation is unprecedented, the response by the Government of the UAE and by our Member States demonstrates the strong bonds that tie us and the shared commitment we have to delivering a truly inclusive World Expo,” said Dimitri Kerkentzes, the Secretary General of the BIE.
“The difficulties raised by the Covid-19 pandemic illustrate the importance of sharing solutions and co-ordinating our actions.”
He added, “The world is now more than ever looking forward to Expo 2020 Dubai to connect, reflect and celebrate the future

Mobile Device Manufacturing Policy approved

on 01/07/2020

The Federal Cabinet has approved the first-ever ‘Mobile Device Manufacturing Policy’ to promote local manufacturing and assembly of mobile phone handsets.
The policy has been prepared by Engineering Development Board (EDB) after extensive consultation with public and private sector stakeholders.
The Economic Coordination Committee (ECC) had already approved the Mobile Device Manufacturing Policy in its previous sitting.
Pakistan which has a market of over 40 million handsets aims to incentivize local assemblers who will provide jobs to local engineers, skilled and semi-skilled educated youth.
The salient features of the policy are as follows:
a. Removal of Regulatory Duty for CKD/SKD manufacturing by PTA approved manufactures under Input/Output Co-Efficient Organization (IOCO) approved import authorization.
b. Removal of Fixed Income Tax on CKD/SKD manufacturing of mobile devices up to USD 350 category.
c. Increase in Fixed Income Tax on USD 351 -500 USD category by Rs 2000 and > USD 500 by Rs 6300 on CKD/SKD manufacturing only.
d. Removal of Fixed Sales Tax on CKD/SKD manufacturing of mobile devices.
e. PTA shall allow activation of handsets manufactured in the country under import authorization of inputs by IOCO in CKD/SKD kit (8517.1211) and not under HS Code 8517.7000 i.e. parts. This will eliminate misdeclaration in parts category at the import stage. Activation of CBUs imported through notified routes after payment of all levied duties and taxes as fixed by government from time to time shall continue till further amendment.
f. In up to USD 30 category, words “except smart phones” to be inserted for CBU imports under 8517.1219 to avoid misdeclaration.
g. R&D allowance of 3% to be given to local manufacturers for exports of mobile phones.
h. Locally assembled /manufactured phones to be exempted from 4% of withholding tax on domestic sales.
i. Government to commit maintaining tariff differential between CBU and CKD/SKD till the expiry of the policy.
j. Local industry to ensure localization of parts and components as per roadmap included in draft policy.
k. EDB to act as Secretariat of Mobile Phone Manufacturing Policy and ensure development of allied parts, components and devices.
A total of 16 local companies are manufacturing mobile devices in the country out of which most of the companies are manufacturing feature phones i.e. 2G.
The companies are now shifting to manufacturing smart phones as technology is shifting towards 4G/5G. The local manufacturers have shown satisfaction on approval of mobile phone policy and are of the considered opinion that investment in this sector will start pouring

NESPAK-led JV wins Diamer Basha Dam’s consultancy contract

on 01/07/2020

Lahore: A NESPAK-led joint venture has won the consultancy contract of Diamer Basha Dam Project through competitive bidding. The agreement was signed at a ceremony held at Mega Hydel Complex, Islamabad. General Manager/ Chief executive Officer/ Project Director Diamer Basha Development Company and Diamer Basha Consultants Group (DBCG) authorized representative Dr. Tahir Masood, MD NESPAK, signed the agreement on behalf of WAPDA and the Joint Venture respectively.
Ministry of Water Resources Federal Minister Muhammad Faisal Vawda, Federal Secretary Muhammad Ashraf, Joint Secretary Syed Muhammad Mehar Ali Shah, WAPDA Chairman Lt. Gen. (Retd) Muzammil Hussain, NESPAK Managing Director Dr. Tahir Masood, WAPDA Authority Members, senior officers and representatives of the consulting firms were also present on the occasion.
The Consultants will provide services through a joint venture comprising six Firms as JV members/partners, namely, National Engineering Services Pakistan (Pvt.) Ltd – Pakistan (Lead Firm), Pöyry (AFRY) Switzerland Limited – Switzerland, MWH (Stantec) International, Inc – USA, DOLSAR Engineering Inc. Co. – Turkey, Associated Consulting Engineers ACE Ltd. – Pakistan and MM Pakistan Pvt. Ltd – Pakistan. The Consultants’ scope of services includes detailed design review, construction design, construction supervision, contract administration and environment and resettlement aspects. It is pertinent to mention that NESPAK has been assigned the lead role in the contract for consultancy services in such a mega water sector project.
Diamer Basha Dam is proposed to be constructed on the Indus River. The site is 315 km upstream of Tarbela Dam Project, some 180 km below the town of Gilgit and 40 km downstream of Chilas, the headquarter of District Diamer in Gilgit-Baltistan. The project comprises construction of 272 m high Roller Compacted Concrete Dam (RCC), spillway, power intake, waterway tunnels and underground powerhouse one each on right & left side Abutment.
The project is scheduled to be completed in one hundred two months. On completion, the dam as proposed will be one of the largest RCC Dam in the World, the reservoir project will store about 8.1 million acre feet (MAF) of water, the powerhouse will generate 4500 megawatt (MW) of low-cost hydel electricity and help mitigating floods. About 1.23 MAF of land will be irrigated because of Basha Dam.