The change of management in the recently privatized
Karachi Electric Supply Corporation (KESC) is scheduled to take place by
the end of this month or in early April, 2005.
The deal may not be the 'bed of roses' as the new
management has to confront big challenges in order to bring back
valuable clients into its consumers list, said Dr. Mirza Ikhtiar Baig,
Chairman SITE Association of Industry in an interview with Pakistan
and Gulf Economist.
He was of the view that "handing over of KESC to
the Army was a big mistake, despite the fact that Managing Director
Brig. Tariq Saddozai being really capable of handling the organization
As a rule, every organization needs its own experts
of the respective fields. However Brig. Tariq Saddozai steered the KESC
to the stage where it could be smoothly privatized.
During last few years, KESC lost a large segment of
its valuable consumers i.e. industrial consumers which really generate
revenue for the utility company. For example one industrial consumer was
equal to thousands of domestic consumers in general terms. A list of the
industrial units which preferred to go into self-power generation shows
that more than 500MW of power is being generated in the captive power
plants while almost equal demand for self-generation is pending with the
SSGC seeking gas connection for power generation.
If industrialists were provided quality services by
the utility why they should have taken pains to go into self-power
generation. Actually the government has sold 1.8 million consumers to
the private sector in the shape of privatization of the KESC as the
immovable and operational assets were still held by the government under
the cover of 25 percent shares retained by the government. It is the
consumer base which is now important for the new comers. The first
priority for the new management will have to provide quality services at
an affordable rate to expand its consumer base.
Industrial and commercial consumers spent billions of
rupees for self-generation facility to avoid unannounced load shedding,
abrupt power breakdowns and persistent power fluctuation which causes
production equipment losses besides a real hurdle in honoring the export
Just have a look at the main commercial important
areas of Clifton, I. I. Chundrigar Road and other commercial centers
where billions of rupees have been spend on installation of power
generators by the commercial organizations, banks and petrol pumps as
the nature of their business can not afford a 10-minute power failure.
Thousands of domestic consumers have also gone into
self-generation to cope with load shedding and power failures. It has
been estimated that over 80 percent of consumers can not afford power
outage or power failure. Since last few years, Pakistan especially
Karachi, has become a good market of power generators of various
capacities. At the one hand, government is loosing huge amount in shape
of losses and power theft and on the other citizens are spending huge
foreign exchange in need of power generators.
Looking at the current economic situation, we have to
confront with aggressive regional competitors, we have to establish our
credibility in the export world. While on the home front, we have to
generate employment in national interest. We have to compete with latest
technologies. The question arises how we can address all these issues in
the face of poor state of infrastructure especially, the power sector?
As a matter of fact, nation needs cheap and uninterrupted power supply
for a real take off in the manufacturing sector which produces export
Regarding huge budgetary allocations and subsidy
provided by the Federal Government to run the KESC, Ikhtiar Baig was of
the opinion that money alone cannot do magic in any organization unless
professional and dynamic planning and strong follow up of the decisions
are ensured. The most terrible challenge for the experts is that they
have to plug the holes which are allowing 38 to 40 percent losses mainly
on account of power theft, this will make KESC really a profit-making
Replying to a much talked about unemployment fear in
the KESC, Dr. Baig said that this is just politically motivated issue.
How can any utility are run without employees or workers, if some people
are given golden handshake they would be replaced with competent people.
Now I don't want to go into the detail of previous attitude of the labor
unions, but the fact can not be ignored that in the past certain
elements destroyed the utility only for the sake of their leadership and
However, we should not go into the detail and stories
of the past that would be just waste of time for everyone but we need a
power company which could give us smooth power supply on affordable
prices so that industrialists burden of power should come to an end. He
further said: "now the recent agreement with the employees and
union gives a guarantee of their rights but everything can not be done
just for the sake of union and employees rights. The employees and union
only exist when KESC is there and is being run in profit only by the
true professionals and experts."