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'Wapda no more in financial turmoil'RECORDER REPORT

KARACHI: Wapda said on Friday it had come out of its four-year financial crisis and posted Rs 12.4 billion provisional profit for the initial six months of current fiscal year.

A massive financial restructuring of the power utility has also been carried out. Accordingly, the Economic Coordination Committee (ECC) has recently extended its approval to convert Rs 36.4 billion government liabilities against Wapda into equity, raising total government equity to Rs 47 billion in Wapda.

"Wapda is now in no financial turmoil" Manzoor A Shaikh, Member (Finance), Wapda, told a press conference in Karachi. He was assisted by Javed Nizam, General Manager, Finance (Power). Giving an extensive statistical view of the rejuvenated financial health of Wapda, Manzoor said that the Authority was now maintaining cash liquidity and was fully capable of meeting its all financial liabilities. We have paid Rs.1.6 billion against Rs.2.4 billion Wapda bonds, whose maturity has fallen due, while re-rolling Rs.1.8 billion. That indicates the improvement in the financial affairs, he pointed out.

Regarding Wapda's receivables, while terming it as a tricky issue, Manzoor said a huge sum of Rs 62 billion had accumulated in outstanding bills. Of this amount, only Rs 13 billion is payable by the private sector whereas the rest of Rs 49 billion bill related to the federal and provincial governments. On the other side, the utility's payables stood at Rs 41.8 billion.

About the ongoing development projects, the completion of which had been lagging behind schedule due to cash-crunch, Mazoor said these had been laid on track again. " We have even arranged the foreign exchange component of 29 million dollars from our own resources to pay the contractors of Chashma Hydel Power Project, which is now near completion. The Citibank had not extended 70 million dollars facility to the project in the backdrop of nuclear tests," he said Ghazi Barotha is now heading towards completion in accordance with its actual schedule since land settlement and other issues have been sorted out amicably, he said.

Giving an account of July-December 1999 period, the Wapda official said that the authority was paying GST in line with the government policies. About Rs 2.5 billion GST had been paid so far since its implementation. Only a sum of Rs 1000 million had been adjusted by the federal government against the total GST payment by Wapda, he said. Moreover, Wapda had got only Rs 2 billion adjusted against the subsidy granted by the former prime minister to the general consumers. Reimbursement by the federal government of a sum of Rs 6 billion was still lying pending.

Manzoor said that Wapda effectively absorbed its additional cost of generation which increased by Rs 2.5 billion due to fuel oil adjustment by the federal government. "We did not pass it on to the consumers through the lending agencies advised us to go to NEPRA for higher tariff adjustment."

Breakup of the federal and provincial Wapda defaults shows that the federal agencies have to pay Rs 11 billion; Punjab Rs 4.5 billion; Sindh Rs 16 billion- subject to Court decision Ñ; NWFP Rs 800 million and Balochistan Rs 500 million. KESC is another big defaulter of Wapda having an unpaid amount of Rs 7.4 million. FATA is to pay Rs 3.6 billion. He said efforts were on to bring FATA at par with other areas. The chairman of Wapda had held meetings with the provincial governor to devise an efficient strategy to recover Wapda bills from these areas. It has been suggested that the political agents or tribal chiefs may be designated to collect bills on behalf of Wapda. Azad Kashmir was another habitual defaulting area. Recovery from this part of the country was slow, the reasons being socio-political condition of the area, he said.

He said that about 2000 officers and staff had been removed by Wapda on account of incompetence or malpractices.