Islamabad, Feb 13 (IANS) Pakistan's economic managers must implement crucial reforms to restructure the entire power sector, said a leading daily that warned "until then, we should forget about an early economic recovery".
In its editorial, the Dawn said that at the beginning of the current financial year, the government must have hoped that the power sector subsidies for the entire fiscal would not cross the Rs.120 billion mark.
"That they did, shows that our economic managers made a wrong estimate...The massive line losses had not reduced; theft had not been controlled; electricity prices were not raised to reflect the actual cost; the energy mix was not changed to cut generation costs; and the inefficiencies of public-sector power producers were not checked."
The daily said the government has "ended up injecting Rs.200 billion into the power sector in less than seven and a half months. Another Rs.50 billion will have to be provided to Pakistan State Oil over the next few days to avoid disruption to the fuel supplies meant for thermal power stations," the Dawn underlined.
In its annual report on the state of the economy during the last fiscal, the State Bank had sounded optimistic that power subsidies wouldn't prove to be a drain on meagre financial resources this year because the government had already paid off the accumulated subsidies of Rs.391 billion or 1.9 per cent of the GDP for the last fiscal against the budgeted amount of Rs.147 billion.
"The government has provided over Rs.1.2 trillion as power subsidies...Yet we don't have electricity for our homes, shops and factories..."
"Our economic managers will continue to face embarrassment unless they start implementing crucial reforms to restructure the entire power sector, or, at least, to budget the subsidies accurately. Until then, we should forget about an early economic recovery and the generation of enough electricity to light up our homes and shops and to operate our factories," the editorial added.