INTERVIEW WITH ZUBAIR TUFAIL, EX-VP FPCCI

(feedback@pgeconomist.com)
Dec 5 - 11, 2011

PAGE: TELL US SOMETHING ABOUT YOURSELF.

ZUBAIR TUFAIL: I was born in Karachi in 1951 and had my school and college education in this city. I joined family trading business of chemicals, plastics and other products in 1970. In 1995, our company set up first chemical manufacturing unit near Lahore and in 2009 set up second unit at Port Qasim, Karachi.

PAGE: AN ESTIMATE SAYS THE PREVAILING ENERGY CRISIS HAS LEFT AROUND 25,000 INDUSTRIAL UNITS SICK AND MORE THAN 400,000 PEOPLE UNEMPLOYED. WHAT ARE YOUR VIEWS?

ZUBAIR TUFAIL: Yes, the country is facing shortfall of about 5,000mw electricity and gas resources are also declining. This situation has resulted in closure of more than 25,000 industrial units and left more than 500,000 peoples out of job. At the same time, load shedding is affecting citizens in cities as well as villages with power outages of 6-12 hours. Although the country has installed capacity of 19,500 MW, present production fluctuates between 13,500 to 14,500 MW. Many power plants are not producing electricity due to non payment by government or so called circular debts. Best solutions are:

A) SHORT TERM: Import of LNG and Gas from Iran

B) LONG TERM: Development of power plants based on Thar coal and construction of small and big dams

Short-term goals of LNG can be achieved in 18-24 months and Gas pipeline from Iran may take 3-4 years from startup in Pakistan. Power plant based on Thar coal can start work in 3-5 years. Large dams may take 7-8 years after startup of work.

PAGE: A CHINESE COMPANY REACHED AN AGREEMENT WITH THE GOVERNMENT TO MANUFACTURE POWER TURBINES. IS IT A STEP IN THE RIGHT DIRECTION?

ZUBAIR TUFAIL: The Chinese company, which signed the contract with the government for manufacturing of turbines is a very good step, but it would have been better, if the contract were signed with the private sector. The government is already privatizing their existing units/businesses.

PAGE: WHERE DO YOU FIND ALTERNATIVE ENERGY DEVELOPMENT BOARD (AEDB) IN THE PRESENT ENERGY CRISIS?

ZUBAIR TUFAIL: AEDB has not produced the desirable results. We do not find any project coming into action under the guidance or help of the board.

PAGE: CAN THAR COAL BE AN ALTERNATIVE SOURCE OF ENERGY?

ZUBAIR TUFAIL: Thar coal may be very important new energy source, which can solve energy problem of the industrial sector as well as others. Sindh is rich with coal resources and important companies like Engro are seriously working to develop coal-fired power plants with capacity of 1000 MW or more. If infrastructure is developed by the Sindh government, coal power can reduce the existing shortfall of 5,000 MW. It is necessary to goad foreign investors towards the energy sector by offering them better incentives/tax exemptions.

PAGE: ARE YOU SATISFIED WITH THE CURRENT LEVEL OF INVESTMENTS IN THE ALTERNATIVE ENERGY SECTOR?

ZUBAIR TUFAIL: So far, investment in the alternate energy projects is very low and needs policies, which may encourage local and foreign investors.

PAGE: YOUR COMMENTS ON LOSSES INCURRED TO THE INDUSTRIAL SECTOR BECAUSE OF ENERGY CRISIS.

ZUBAIR TUFAIL: Industrial sector is facing enormous losses due to energy crisis, which is causing low production as well as high cost of production. If that persists, slippages in export targets will become common. Industries are bound to foot the bill of 365 days whereas production is running for 270-280 days per year. This situation is forcing many industries especially textile to lay off the workers, thus creating social unrest in the society.