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Hubco, Wapda accord failure may damage foreign investment prospects: SC told

RECORDER REPORT

ISLAMABAD: Hub Power Company counsel told the Supreme Court here on Wednesday that if the agreement between his client and the Water and Power Development Authority (Wapda) failed it would damage the prospects of future foreign investment in Pakistan.

Continuing his overnight arguments before the five-member special bench, Abdul Hafeez Pirzada said that the failure of the agreement would repudiate the chances of industrialised countries investing in a developing country like Pakistan.

He said that the discrepancies now being discovered by the Authority in its agreement with Hubco should have been plugged when the agreements was being signed by the parties under the blessings of the federal authorities.

Pirzada was appearing for the second consecutive day before the specially constituted five-member bench headed by Justice Mohammad Bashir Jehangiri. Other members are Justice Ijaz Nisar, Justice Abdur Rahman Khan, Justice Riaz A Sheikh and Justice Munir A Sheikh.

He said the supplementary clauses on the revision of electricity rates were signed by a full member of the Board of Wapda who was authorised by the then Chairman of the Authority and, in case he lacked the confidence of his chief, it should have been made known immediately after. But, he pointed out, no objection was raised for two years but as soon as Benazir's administration got a sack, the Wapda started finding faults with the amendments and started accusing the independent power company of giving kick-backs, fraud and corruption. It was a conspiracy which was cooked up to discredit his client and create disputes, he added.

Pirzada said the Nawaz Sharif government and his Ehtesab Cell had treated the independent power companies badly and terrorised them into submission by introducing special laws through presidential ordinances.

He said that a public interest petition was sponsored by the Ehtesab Cell through Aziz-ul-Haq Qureshi that was directed against his client. He said it was a conspiracy by the Ehtesab Cell to wreck the national economy.

He gave a list of actions taken against Hubco, including the freezing of its accounts and restraining order to the State Bank of Pakistan not to transfer funds on behalf of the IPP.

He also recounted the events leading to the present litigation and said that following the public interest petition of Qureshi, a bench of the Lahore High Court had fixed a per kilowatt tariff for the electricity produced by Hubco. While the LHC asked Wapda to buy Hubco power, it fixed a ceiling of Rs 845 million as the maximum monthly payment to the company.

He told Justice Riaz A Sheikh that the above amount was not decided by anyone alone but was done jointly by the two parties.

Hubco chief executive, Khurshid Hussain, then briefed the court on the payments to his company by the Authority. He said that the increase in the tariff was required by the increase in the prices of fuel which, he said, were spiralling every day.

The court will resume the hearing on Thursday when Pirzada will resume his arguments. Hubco's senior counsel was assisted by Makhdoom Ali Khan, Afzal Siddiqui and Rashed Hanif while Wapda was represented by Farhruddin G Ebrahim, Umar Atta Bandial and Uzair Karamat Bhandari.