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Body to settle Frontier's share issue in profits on hydel power

IQBAL KHATTAK

PESHAWAR: The Centre on Thursday stepped in to help the Frontier government get its due share in net profits on hydel power from Wapda by forming a three-member body to resolve the long-standing issue amicably.

"Our intentions are sincere and that is why we want to resolve this problem amicably," Federal Finance Minister Shaukat Aziz told journalists at the Sarhad Chamber of Commerce and Industry (SCCI), where he gave a patient hearing to local industrialists and small traders' grievances.

Shaukat Aziz continued, "There were very useful deliberations on the (Frontier) demand and its every aspect was discussed with the governor and other high-ranking officials during the meeting".

Through dialogue, Aziz remarked, the federal government wanted a solution to the issue. "The Frontier's demand will be met," he added. He said the three-member committee would include Additional Federal Finance Secretary Younas Khan, Wapda chairman and NWFP Finance Secretary Ghulam Dastagir Akhtar. "Soon they will meet to sort out the issue," Aziz added.

The finance minister paid a day-long visit to Peshawar on the provincial government's request as its budgetary deficit has shot up as a result of "unannounced moratorium" by the federal government on the release of Frontier's share in net profit on hydel power.

A source in the Finance Department told Business Recorder that the "budgetary deficit went up to Rs. 6.5 billion after the NWFP received only Rs. 1.4 billion" out of the net hydel power profits for the first seven months of the current financial year.

"We should have been paid Rs. 4 billion by now, which has not been so," the source added, requesting anonymity.

The Minister dispelled the impression that there was a deliberate attempt to block the payment. "This is not the case," he asserted.

Earlier, replying to the list of priorities presented by SCCI President Faiz Rasool Khan, Shaukat Aziz outright rejected one of their demands - to do away with the general sales tax (GST). "It will cover all the remaining areas in the next budget. It is a must," he maintained.

"It is the number one tax of the government. There can be no two opinions on it," the finance minister categorically stated, adding, "it will be imposed across the board".

The Finance Minister also left nothing in ambiguity when he was pressed to revive the special incentives to the Gadoon-Amazai and stressed "tariff-based industry is not sustainable. However, your non-tariff based recommendations in this regard will be welcomed," Aziz spoke his mind.

However, former FPCCI president Ilyas Bilour came out with full support to revival of special incentives to the Gadoon industries. "Investors only went there when they were offered special incentives, otherwise, sans special packages setting up industries in Gadoon was useless," Ilyas argued.

The Frontier traders' another main demand was permission for land route trade with Afghanistan. It also received a lukewarm response from the Minister. However, Aziz hinted at allowing exports to Afghanistan on "experimental basis".

But Aziz's proposal annoyed the local traders, who claimed they were being singled out as land route trade with Afghanistan was allowed through Chaman in Balochistan.