Turkey request Pakistan to soften their stance on Rental Power Plant

Turkey request Pakistan to soften their stance on Rental Power Plant

Monday, May 21, 2012: Pakistan government has rejected a request by Turkey seeking support for a Turkish Rental Power Plant, Karkey Karadeniz, whose accounts have been frozen following Supreme Court’s judgment that cancelled all
rental power projects.

The visiting Turkish Economy Minister Zafer Caglyan made the request during a meeting with Commerce Minister Makhdoom Amin Fahim on Monday.

He said Turkey sought a resolution of the dispute involving the Turkish firm. However, Fahim showed his government’s inability in settling the dispute while arguing that since the apex court had already given its judgment against
all rental power plant projects, thus, the government cannot do much, he added.

In March this year the Supreme Court ordered wrapping up RPPs contracts and asked National Accountability Bureau to move against all those who have been involved in striking the deals that many believed became a multi-billion dollar
scam.

The government signed a five-year contract with Karkey Karadeniz which had a 222 megawatts generation capacity. The government would pay $565 million on account of rent for producing electricity, according to audit report of the
RPPs, carried out by Asian Development Bank on request of the government. The Karkey became controversial when reports appeared in the press that the government was paying millions of dollars to the plant despite the fact that its production was almost nil.

According to an official handout, the Turkish Minister for Economy Zafer Caglyan pointed key concerns of Turkey regarding high taxes, custom duties and matters relating to port and shipping. He also highlighted the investment interest
of different Turkish companies for Pakistan and their related requirements.

Pakistan also stressed the need for early finalisation of Preferential Trade Agreement (PTA) between both the countries.

The Turkish government was reluctant to offer preferential treatment on goods that has implications for its trade with European Union, minimising chances for early finalisation of the deal. 

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Posted by Wajahat Javed on May 22 2012. Filed under Business, Pakistan. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry