Why Pakistan’s Economy Could Not Become Self-sustaining by Suleman N. Khan

8/14/2019 Why Pakistans Economy Could Not Become Self-sustaining by Suleman N. Khan

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WRDC

Pakistans Dilemma

Industrialize or Perish (a primer)

Suleman N. Khan (28 March 2008)

Convener, Water Resource DevelopmentCouncil & Conference on Water Reservoirsin the National Economy held 09 Feb 1998

Fellow, Institution of Electrical & ElectronicEngineers of Pakistan (IEEEP)Email: [email protected]

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mailto:[email protected]:[email protected]


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Contents

Pg No.

1) Preamble 1

2) A Note 3

3) Part I : The Facts are that . 5

4) Part II : The short and medium term solutions 30

5)Part III : Conclusion

39

6) Appendices:

Mr. S.S. Kirmanis fax of 4 Feb 98

PMs Office Directive 24 Oct 98

Press Release HUBCO Summary of 29 Nov 99

WAPDA letter of 26 June 04

Letters of Lt. Gen Dr. G.S Butt to the President

a) 02 June 04b) 09 July 04

c) 18 Nov 04

WRDC circular letter 001 of 15 March 08 may also be read at

Web Address www.wrdc.com.pk

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http://www.solodyn.com.pk/http://www.solodyn.com.pk/


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Extract from David E. Lilienthals article, ANOTHER KOREA IN THE MAKING? as sent by Mr.

Eugene R. Black, President IBRD with his letter of 06 Sep. 1951 to Prime Minister Liaqat Ali Khan ofPakistan:

Quote:

Why the flow of the Punjabs lifeblood was so carelesslyhandled in the partition no one seems to know. Pakistan includessome of the most productive food-growing lands in the world inwestern Punjab (the Kipling country) and the Sind. But without

water for irrigation this would be desert. 20,000,000 acreswould dry up in a week, tens of millions would starve. No army,with bombs and shellfire, could devastate a land as thoroughly asPakistan could be devastated by the simple expedient of Indiaspermanently shutting off the sources of water that keep the fieldsand the people of Pakistan alive.

The partition gave the major part of the irrigated lands of thePunjab and sind to Pakistan; but the headwaters of some oflargest irrigation canals that feed Pakistan where left with Indiaor Kashmir. All the rivers upon which Pakistan depends for lifeoriginate in India or Kashmir. Two thirds of the entire watersupply originates in Kashmir where the snow-fed Indus rises.

Unquote

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Preamble: A sinner like myself can be sometimes motivated to speak out against tyranny and seriousblunders by compatriots. It was in Feb 94 when Mr. Mustafa Khar the newly appointed Federal Ministerfor Water & Power of the PPP government made his maiden appearance to preside at a seminar in the

WAPDA Auditorium. The occasion was the presentation of the new Private Power Policy draft; itshighlights & objectives. My class fellow from UET Lahore, the late Mr. Tanvir Azhar was conducting.Tanvir was indeed a brilliant electrical engineer & mathematician. He had rapidly risen to the level ofGeneral Manger in Nespak. The Energy Czar of the PPP government Mr. Shahid Hassan Khan hadnominated Tanvir as the first Director General of the Private Power & Infrastructure Board (PPIB)Islamabad. Tanvirs book Quest for Power was an excellent treatise of his mathematical skills and hispower system control & data acquisition work at Nespak for the WAPDA network. One had been awareof the basic recommendations of the TASK FORCE on Energy (Jan 94). My serious concern was that anynew power policy which is uncapped will destabilize WAPDA eventually the national economy &ultimately damage the Federation. One was also aware that OECD Helsinki Accord of August 1992 wasthe pretext for radical changes in financing of public sector infrastructure including power systems and

had brought along my article Statement on Electric Power. In the recess Tanvir read it. He saidSuleman this is a meaty article but we have decided that WAPDA has to be dismantled and privatized.The new Power Policy to be announced next month (March 94) will be inviting Independent PowerProducers (IPPs) and the ban on WAPDA constructing new thermal power stations will remain. Igrumbled that the Hub Power Agreement of August 92 has been made even more unsustainable afterPPPs new government appointed Mr. Shahid Hassan Khan its Energy Adviser. The Hub project was nowbeing blessed with its progeny before the impact of its Power Purchase Agreement (PPA) is assessed. Theoil import lobby was clearly winning. Tanvir, God bless his soul, was commercially nave.

We learnt that Pakistan was adopting the California model of IPPs but with radical changes i.e it wasbeing made unsustainably generous. The California model inflicted great damage to the economy of

California within the 90s decade. Some of us observed that the 1994 Private Power Policy was an evil onthe scale of the Agartala Conspiracy which had resulted in East Pakistans separation from Pakistan. Weformed a small group of rebels who were writing & speaking at every forum & venue. Uetians of my eralooked at Prof. Malik M. Anwar as an icon of wisdom & patriotism. He had left Lahore in the mid 70s topursue his doctoral studies at MIT. The advice of this sage from Boston was the new East IndiaCompany has arrived. In Nov 1996 I circulated an essay Industrialize or Perish. It covered all aspectsof the economy i.e Industrialization, Technology, Irrigation system and the Energy mix. Friends asked meto compile it as a detailed study, basically in a book form. I set about this task ten years late and hope tocomplete it within 2008. The desperate economic situation that has engulfed Pakistan in 2007 compelledme to urgently create a condensed form which is presented here. Hopefully you will agree with EdwardBurke The only thing for evil to triumph is for good men to do nothing. I salute the wisdom of my

guides; late Engr. Dr. Alfred Gerber who educated me on the potential of the Pak economy and late Engr.Dr. Ghulam Safdar Butt (Lt. Gen. Rtd) who made the international conference of 9 Feb 98 possible andwas an inspiration till his passing away in early 2006. I also salute the courage of several patriotsincluding Mr. Hidayatullah whose conscience reportedly resulted in his exit as auditor of Hub Power Co.Mr. Aziz Qureshi an ex-banker who was the moving spirit in WAPDAs short lived legal challenge toHub Power Cos indiscretions allegedly committed in their first 2 years of operations (1996-98). Mr.Salahuddin Rifai former G.M WAPDA / NTDC who ensured economic despatch without fear & favour.The rogues can also be identified. Above all the Indian factor emerges very strongly.

It was on 09 Feb 98 that our nascent NGO (Water Resource Development Council) convened a conference onWater Reservoirs in the National Economy at Islamabad. The morning session was presided by the PrimeMinister and during the full days discussion all major aspects of our predominantly irrigated agriculture,

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hydro energy potential and related aspects were addressed. The legendary S.S Kirmani Sahib was unable toattend but his kind fax message was read out. Three months later he was summoned by the Creator . Hismessage remains most relevant. The guest from Turkey Mr. Aker made an inspiring analysis of the GreaterAnatolian Project (GAP). An enlightening talk was given by Dr. Peter Grein of Switzerland on desilting ofreservoirs and his experiences in China. Our NGO was privileged to have presented late Maj. Gen. (Rtd)Fazle Raziq, late Lt. Gen (Rtd) Dr. Ghulam Safdar Butt & Engr. Hissamuddin Bangash. The guest speakerEngr. Khalid Mohtadullah (Member Water, WAPDA) had discussed the benefits of reservoir construction andexplained the details of the IBIS (Indus Basin Irrigation System). There was a prolific technical session in the

afternoon presided by eminent irrigation engineer of Sindh Mr. Elahi Buskh Soomro, then Speaker of theNational Assembly. The expected pit-falls in the building of Diamer -Bhasha and the near impossible status ofKatzarah/Yago/Skardu on humanitarian and ecological grounds were also deliberated by several experts. Aresolution was unanimously approved by the delegates for the construction of atleast one reservoir on theIndus without further loss of time. Everyone agreed that some 16 years had already been lost as 10 years afterTarbela (1974) a new reservoirs construction should have started and would have been available by 1990. Infinancial terms a staggering wastage of around USD 200Bn equivalent between 1990 and 2007 due to non-availability of a second reservoir on the Indus that could have kept our economic growth far ahead of ourpopulation increase. A near hopeless sociological situation as experienced today would have been averted.

The arbitrary private thermal power policy of 1994 based primarily on imported oil after imposing a ban onincreased public sector generation was a national tragedy. Let us now discuss the rising menace of IndiasNorthern Canal Project. What this USD 200Bn + project means for the future of our children. The realimplications of Baghliar Dam, Kishinganga Barrage and the infrastructure on the Wullar Lake. Being in thepeace mode we should surely advocate a peaceful accord. There has to be a consensus internally andthereafter a recognition by the world community of our historical apprehension that Kashmir is a waterrelated issue. Since 1947 we have failed to surmount the Indian factor. India must respect in letter and spiritthe tenets of the Indus Waters Treaty 1960. It is sacrosanct. Tragically the Indians are now guilty oflaying the groundwork for genocide of our nation through the ongoing theft of Pakistan waters.

The sustainable solutions of the energy, industrial, agricultural and social crises are presented in outline. Whydid PM Shaukat Aziz again block WAPDA in 2005/06 from building 2000MW of thermal power based oncombined cycle P.S (gas fired) after allowing their construction in 2004? Above all why he was hostile toconstruction of hydro-electric (hydel) power stations on fast-track basis. MoUs were signed with top PRCcorps in the presence of the President He blocked and cynically derailed hydel run-of-the-river projects(primarily in the public sector) during the period 2003/04/05. He also argued that loans from EXIM Chinaabove 5% pa are not acceptable. This was the period this banker turned emperor could not appreciate the largemacro-economic picture. He actually scuttled US 2 cent hydel projects (zero fuel pass through costs) on theuntenable basis of supplier credit interest rates being 5.5% pa against his demand of 5% pa (or lower). TheNPV of the hydel projects he blocked are many multiples superior to the private oil based projects hesupported. On 7 Jan 04 as Finance Minister presiding over an ECNEC/ECC he declared let us stop thisculture of Mouization. Most took it as a reference to Chairman Mao This smooth talking banker acting asan economist ensured that Pakistan is held hostage to the oil lobby. A fatal embrace after the escalation of oilprices. Mr. Aziz forgot that in May 2000 he had gone to Beijing, cap-in-hand, for a roll-over of USD500 mnwhich was the bulk of Pakistans Forex Reserves. Why did HUBCO an IPP capable of 1292MW produce

around 300MW during the critical weeks of Dec 07 and Jan 08? They may have been within the parameters oftheir agreement but was this act fair to Pakistan? Why Mr. Ghait Pharon was allowed to control the rate ofbitumen due to his takeover of the National Refinery? He already controlled Attock Oil Refinery. Why did Mr.Shaukat Aziz snub the Textile sector when they asked for a life sustaining subsidy? Why did national planssuch as the 1994 National Power Plan go into cold storage? I should not be raising these queries because afterall Mr. Shaukat Aziz had arbitrarily withdrawn WAPDAs legal suit against HUBCO in 2000 inspite of seriousviolations listed in the WAPDA case. Also Mr. Shaukat Aziz unleashed Mr. Shakeel Durrani onPakistan and turned a blind eye when he was blocking critical hydropower projects as CS NWFP and later asChairman Pak Railways attacked his own predecessors on their purchase of Chinese DE locomotives. Can thenation forget that in year 2000 the Chinese people were the only friends willing to finance ourinfrastructure development and even rolled over the critical Forex reserves with the State Bank?Long live Pakistan.

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A NOTE: Why Pakistans economy could not become self-sustaining

The Statement of Dr. Salman Shah, former Adviser to the PM on Finance and Revenue asreported on 30 July 07 to the effect that private companies will build and operate mega dams hasjolted many of us out of our stupor. Such a model does not exist anywhere. A developing countrywith an agrarian economy cannot even dream of handing over its irrigation water to the privatesector. It is clear that the mistakes committed since 1980s in the sector of Utilities is reaching thepits. There is a Chinese saying when a Utility is in profit the nation is in loss. Tragically wehad created a USD two billion financial black hole in our economy by the year 2004, thanks tothe unsustainable private thermal generation which was uncapped and based on imported oil. TheIndependent Power Producers (IPPs) were inducted under the 1994 Power Policy. The devil is inthe detail. WAPDA/GoP has to pay the fuel cost differential as a pass-thru component.

The hibernating HUBCO Agreement of Aug 1992 (negotiated since 1985) was made functional by unfair concessions through amendments upto 1994. HUBCO was the experiment the

genesis of which were laid in 1985 on the advice of IMF. It was finally negotiated with a BritishGroup (National Power) who brought in several partners including the Saudi Sheikh Ali Reza ofXenel. To accommodate this 1292MW conventional HFO (furnace oil) fired steam power station,WAPDA had scrapped plans for the 1000MW imported coal project to be financed by Canadaand froze the extension of Jamshoro thermal P.S. for which the Japanese Govt had offered toaccept payment in Pak Rupees. Mr. Jam Yousaf Federal Minister of Water & Power gifted a 7 kmof beach near Karachi city. A tax free island in Baluchistan. The area gifted is larger than HongKong. For just a 1292 MW power station! The World Bank had estimated USD 0.8 mn/MW butlater allowed USD 1.2mn/MW. This was the period when Bangladesh was purchasing steampower stations with gas fired boilers at USD 350,000/MW. Thank you Mr. Ibrahim Elwan. Today15 of the 19 originally sanctioned IPPs under the 94 Private Power Policy are established. This

means about 60% of the total thermal installed capacity and more than 40% of Pakistansgenerating capacity is in private hands (effectively foreign hands).

In contrast both China and India never appreciated this IMF/World Bank concept and did notallow more than 5% of IPP power in their national grids. Even then they later discarded a few ofthe projects while in Pakistan we see that IPPs have throttled the public sector. Surely the OECDHelsinki Accord of 1992 discouraging bilateral financing was not a signal for new imperialismthrough IPPs? There were some unsung heroes within WAPDAs hierarchy. The clean andbrilliant member Power Mr. Javed Akhtar was squeezed out in May 1994 just some five monthsbefore his retirement. His successor Mr. Saeed A. Niazi also a clean person was pursued to hispost operative hospital bed for signatures on the HUBCO amendments. A mere formality as

WAPDA could not refuse. It is not a co-incidence that the IPPs have found an opportunity toprovide over 66% of Pakistans electric power taking advantage of the low hydel generationcycle. This is unsustainable and the dire predictions made in 1994-99 period by several of ushave been unfortunately accurate. Mass industrialization is now impossible. This is the age ofaluminum but we cannot have an aluminum smelter since it is not viable with expensive electricpower. Similarly we are excluded from several basic industrial infrastructure. The developingworlds most expensive power is now perforce being supplied to domestic users (over 60%) thento industry (around 28%) and agriculture (around 10%). The IPPs propaganda machine is soeffective that even sensible people are heard expressing their gratitude for the great contributionof IPPs, oblivious that imported fuel based IPPs are playing havoc with our economy. Where inthe world do investors get a blank cheque for their capital cost repayments & pass-thru increase

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in fuel prices, all indexed to U.S CPI, as allowed in the 1994 Thermal IPP policy? Projects thatwere granted without competition for a minimum guaranteed profit over a thirty years periodfound ways to increase their IRRs through several routes. The capital costs of the projects(including HUBCO) being a direct liability of the GoP. Who could resist over invoicing if someone else has to pay the bill? Yes there was to be no taxation on the income of IPPs although theyare Pakistani companies. The US 6.5 tariff is a bluff as furnace oil is pegged at a rate (Rs2350/ton) which is around 6% of todays rates. The difference payable by GoP/WAPDA. Since

2006 we see rental power also being contracted. Imported oil cannot bring prosperity. The fuelwould be provided free (pass-thru) to the IPP operating the rental power station. How can anyone justify the actions of former Prime Minister Shaukat Aziz to disallow WAPDA/Genco fromplacing the order for 500MW Chichoki Mallian P.S. in 2007. The rates received in late 2006 werecompetitive. The technology & high thermal efficiency of the gas fired combined cycle P.S wasinline with worldwide trends. He also shot-down the second 500MW power station allowed forNandipur. Both thermal projects in the public sector were approved by GoP under a one timewaiver in 2004/05 in view of the impending power crisis. A 1000 MW of additional public sectorpower would have made a difference especially in the perception of IPPs stranglehold. This wasprecisely what Mr. Shaukat Aziz could not allow. Today the new round of Fast Track IPPs basedon thermal energy are negotiating & re-negotiating with GoP/PPIB. Some have been doing it fornearly three years taking max advantage of the shortages & load-shedding. All this while thepublic sector is kept blocked since 1988. HUBCO set the precedents.

When the GNP of a nation does not rise in tandem with its GDP (due to excessive outflows ofprofits and dividends) we have economic and social upheavals. The British Imperial masters hadincreased Indias GDP. After a while they had become a liability inspite of a benign rule.Secondly we all know that economic inequities lead to political and social upheavals.Historically FDI has often been misdirected and used as a tool of exploitation.In Pakistans casewe are no longer having a self sustainable economy primarily due to our tragically flawed

policy in the three crucial areas i.e civilian engineering industry, sustenance of our irrigation

assets and last but not the least our treacherous energy policy. Clearly, FDI is not always

healthy for the recipient. FDI should be accepted on a rational & selective basis. The

Economist of 2 Feb 08 reports that finally India has now eased limits on FDI in six industries

only. These include commodity exchanges, credit information firms, oil refining, titanium miningand parts of aviation concerning only cargo planes & services including relevant pilot training.

In Dec 1998 in the office of the COAS I had presented my essay Pakistans Strategic FederalAssets. In my long meeting I had exhorted all present in his office that WAPDA must be keptintact inline with its charter of 1958. I repeated this analysis in 1999 during the second marathonmeeting with him and several of his military colleagues. On his desire there was a well attendedseminar at GHQ in April 1999 which was coordinated by Lt. Gen Jahangir Nasrullah (Engineer-in-Chief). My team had included some elders of the Feb 98 Water Conference including late Lt.Gen (Rtd) Dr. G.S. Butt, Engr. Hisamuddin Bangash and Dr. H. Grein of Switzerland an

academic associated with ETH, Laussane. No one can object to WAPDAs modernization. It ismodeled on the TVA which is Americas most successful civilian project. The willful destructionof its balance sheet is a national calamity. It was only six years ago when the Indian Army COASreportedly declared and translated verbatim Every proposal in opposition to Kalabagh Dam islike a new nail in the coffin of Pakistans defence capability. In the same period a three memberIndian delegation to an Islamabad conference declared that Indus Waters Treaty is superfluous!

Does the nation realize that thanks to global warming & crop failures worldwide wheat prices haveincreased 300% in the last five years? In a few years there will be no sellers of wheat. The three 2004letters of late Lt. Gen (Rtd) Dr. Butt to President Musharraf are in appendix.

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PART I: The facts are that:

1) The TVA model was used to create WAPDA in 1958 : President FD Roosevelt

when faced with the aftermath of the 1929 market collapse had to highlight & exploitUSAs unutilized potential under the New Deal. He correctly decided that sevencontiguous States had the water resources and the land. The TVA was launched andan institute was created in Mississippi where the best available talent amongstmilitary and civil engineers was brought together. A series of 26 dams and associatedirrigation channels as well as flood control structures in addition to malaria control &fertilizer production were included in the program. The project stimulated the entireUS economy and the benefits that ensued were so great that the USA was ready toface Hitlers war machine. TVA remains a priceless jewel of the US economy.

The historical letter of 6 Sep 1951 written by Mr. Eugene R. Black the President of

IBRD (World Bank) to PM Liaquat Ali Khan and its enclosed 10 page article; AnotherKOREA in the Making? by Mr. David E. Lilienthal as published in Colliers on 4August 1951 is the starting point of the up-gradation of the IBIS. It starts the dialogueto address the core issue of water distribution between India & Pakistan. A statesmenlike initiative with President Trumans blessings. Mr. Lilienthal displays great altruisticsentiments. One of his classical observations The partition gave the major part of theirrigated lands of the Punjab and Sind to Pakistan; but the headwaters of some of thelargest irrigation canals that feed Pakistan were left with India or Kashmir. All therivers upon which Pakistan depends for life originate in India or Kashmir. Two thirdsof the entire water supply originates in Kashmir where the snow-fed Indus rises.

Finally in 1958 President Eisenhower gifted the TVA model in the form of WAPDA.

The largest asset base of Pakistans economy i.e. the Indus Basin Irrigation System(IBIS) was now having a reservoir building organization to provide the water resources.The IBIS can remain an efficient machine as long as it has necessary water. WAPDAwas a timely gift from the Eisenhower administration. On 19 Sep 1960, the IndusWaters Treaty was signed by Pakistan and India, with the World Bank acting as afacilitator & guarantor. The signatories were Indian PM Mr. Jawaharlal Nehru and PakPresident FM Ayub Khan. The very basics of the treatys terms were that India wouldbe allowed the exclusive use of the waters of the three eastern rivers, Ravi, Beas andSutlej while Pakistan was given till eternity the three western rivers; the Indus, Jhelumand Chenab. It was expected to utilize the available marvels of the IBIS known aslink-canals to keep alive the Ravi & Sutlej in its territory. New reservoirs were nowneeded. India was allowed run-of-the-river generation of Hydro-Electric Power on thewestern rivers. The use of low-level gated structures was not permitted. An exceptionwas made for Chenab command areas and Pakistan conceded that additional irrigationwater could be taken sequentially for irrigation in Indian controlled Jammu & Kashmirfrom 0.6mn acres in 1960 to 1.3mn acres. The water quantity being undefined. TodayIndia is taking unfair advantage of this concession by Pakistan.

Mangla dam on the Jhelum river was quickly constructed. Preparation for constructingthe worlds largest earth filled dam (Tarbela) on the Indus were accelerated. The WorldBank was committed to finance one dam on the Indus and to help improve and enhancethe utilization of the existing man made irrigation system inherited in 1947. School

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children in Europe were reading about the coming green revolution in Pakistan. Thecore issue was to keep WAPDA vibrant but we failed to follow through after Tarbeladam was completed in 1974. The Indian factor cannot be ignored. The Chashma Jhelumlink canal was also added in early 1970s but no further reservoirs have been added.The link canals are therefore underutilized. The productivity of the largest asset base i.eIBIS depends on the support it can receive from the second largest asset base(WAPDA). A weakened, water-short IBIS is now unleashing cataclysmic tendencies

starting with social disorder and will lead to total anarchy. The IBIS is a very largemachine and can only remain prolific with the help of needed large reservoirs to sustainPakistans economy.In any case small dams cannot be built on large rivers.

2) Irrigated Agriculture will remain the back bone of Pakistans economy: It alsoprovides the raw material for the textiles which is Pakistans main industrial sector. Itaccounts for atleast 90% of its agriculture production. It is based on our largest assetthe efficient IBIS. An asset in excess of USD 400 Bn (at todays replacement value).This irrigation machine is water short since the early 1990s. The nation cannotmaximize the agriculture output from the 42ma irrigated area. This does not include12ma barani i.e. rainfed areas. Shortages mean that we cannot bring under cultivationthe 21ma lying fallow. Not only additional acreage could be added but the additionalwater would permit triple and quadruple cropping patterns. Before year 2000 thewater availability per capita went below 1 AF per year which is tragic as it means thenation is now water starved. The prolific IBIS machine is water short. The future isbleak.

No new dams have been built since Tarbela (1974). In fact the cumulative reservoircapacity of Pakistan has been reducing since 1974 from 16 MAF to 12 MAF. Thepopulation of Pakistan has since doubled. The IBIS includes 3 main storage reservoirs,20 barrages, 12 Inter River Link Canals, 43 Canal Commands, over 15,000 publictubewells and around 500,000 private tubewells. Some 120,000 watercourses & a hugesurface and sub-surface drainage system. It may be appreciated that one MAF is the

quantum of water if a stream was constantly flowing at a rate of 1381 cusecs for oneyear. Larger than one cubic km of water content. Agrarian economies should aim at astrategic one years surface flow in their reservoirs. India will soon achieve 40%.Pakistan has not even been able to maintain a ten percent (10%) reservoir capacityassuming a 140 MAF annual flow. The nation that has great strategic hydro resources inthe Himalayan & Karakorum glaciers is heading surely towards famine conditions as itfails to store more water and replace the reservoir capacity already lost. Some politicalelements continue to ignore the basic fact that it is floodwaters during monsoon

months that will be stored & utilized during the remaining ten months.

Today the Indus water Treaty (IWT) has become controversial & divisive in Pakistan.

Pakistans military & political leaderships had not shown the resolve after the breakupof Pakistan in 1971 to force the truth on the Nation. Today Indians have the audacity toannounce that the IWT is redundant. While the Indian factor motivates internalopposition (specifically from regional politicians) to new dams on the Indus she quotesinternational law on rights of the upper riparian when the lower riparian fails to fullyutilize sweet water flows for a 30 years period. India ignores that the IWT is sacrosanct& till eternity. Our leadership has not understood the value of water.

Pakistan never exceeded 13% storage capacity. We assume an annual surface flow of theIndus and its associated rivers to be 145MAF. India has surface flows of around 750MAFon an annual basis. Their cumulative storage capacity by 2003 is 245MAF and growing

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fast. They had therefore achieved more than 32% storage capacity. The world average is

40% storage capacity of surface flows. An ideal situation would be storage capacityclose to 100% so that maximum carry over capacity is available for years of drought.The table below will further clarify this point.

AVERAGE ANNUAL FLOW & STORAGE CAPACITY

OF DAMS OF SOME MAJOR RIVER BASINS

S. No.

River

Basin

Average

annual flow

(MAF)

No. of

Dams

Storage

capacity

(MAF)

% age

storage

1 Nile 38 1 132.00 347

2 India(Total) 750 4,636 245 32.6

3 Indus andother rivers 145 3 13.64 9

4 World 20,000 - 8,000 40

Source: Medium Term Development Framework for water sector (Group report)

World Register of Dams 2003-ICOLD (Mr. Amjad Agha, Nov. 2005)

3) The 1991 Water Accord permits about 22 MAF new storages: Half of this wouldbe replacement of capacity lost. It assumes that 38 MAF of monsoon flood waters onaverage flow into the Arabian Sea every year. It was a prosperity document for allfour provinces but has been willfully made controversial. Punjab made major

sacrifices in agreeing to take far less than its due share from the new resources. TheAccord eliminated the concept of Historical Withdrawals of Indus waters. Logicallyit had to cater to the new geographical realities eg: Sind was much larger beforepartition.By year 2010 atleast 11 MAF new surface storage was required of whichhalf was to be replacement storage as the existing reservoirs continue to receive

sand, silt & sediment at the rate of 165 mn tons per year in the Indus River alone.

Without new storages, the Accord would have hardly any value and use. The statusquo option is one of looming famine conditions also for the children of Sind.

Reservoir Sedimentation and Storage Loss in MAF

Reservoir Gross Storage Capacity Storage Loss by year 2004 Loss By year 2013

Tarbela 11.62 (1974) 3.26 (28%) 4.31Chasma 0.87 (1971) 0.39 (45%) Negligible

Mangla 5.88 (1967) 1.29 (22%) 1.71

Total 18.37 MAF 4.94 (27%) (gross) 6.50 MAF (gross)

Live / usable storage is approx 15% less 3.95 (25%) (live) 5.45 MAF (live)

Courtesy Mr. Amjad Agha publication Nov 2005

Sind farmers were receiving in 1991 almost double the canal water compared toPunjab. For every cropped acre, Sind received 3.80 ft of canal water against 2.18 ft forPunjab. Sind canals have water allowances vastly larger than Punjab canals, leading tolarge wastages and heavy water logging. Punjab has more than double the cropped

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There is no known scientific reason (including capillary action) for water logging tohappen. Neither can natural drainages of the NWFP valleys be affected due to KBD.

Bhasha Dam was unfortunately made the focus of attention by former ChairmanWAPDA in July 2001 during the launch of WAPDA Vision 2025. This was an errorof judgment as our conference of 09 Feb 98 based on rational data had concluded thatBhasha is above all a debris-check dam for enhancement of Tarbela Dams useful life.Conceived as a roller compacted concrete gravity dam about 232m above riverbed andabout 281m above bedrock it dwarfs even the Grand Coulee. No doubt it will addaround 5MAF reservoir capacity and cheap hydropower during its short life span but itsconstruction is a monumental task, which could involve upto 15 years. Several majorconstraints in building Bhasha are well known. The KKH from Thakot upto site (over200 km) has to be strengthened/widened. This is an arduous task. There are absolutelyno construction materials at dam site (only granite). The upstream KKH around 100 kmhas to be rebuilt at a higher alignment (about 900 ft higher). There are strong liftingpressures due to soil conditions of the riverbed. After all we are attempting to constructthe highest ever (nearly 270m) Roller Compacted Concrete (RCC) dam in the world.Higher than Hoover Dam! No rock or earth filled base. The dams downstream terrainhas a climb elevation of 1:7, which is excessive for operation of heavy constructionmachines. Finally it is an active seismic zone of the Karakorums where the Indian andCentral Asian plates meet. The ongoing design is theoretically beyond todaysknowledge of dam building technology. Let us keep in mind the Pattan earthquake ofthe 70s and the October 2005 earthquake. If this dam breaks it will leave nothing in itspath upto Sukkur. Late Lt. Gen. Dr. G. S. Butts three letters of 2004 to the President ofPakistan bear testimony to the great challenge of building Diamer Bhasha.

4) Appointment in 2004 of Mr. A.N.G. Abbasi as head of the so called technicalcommittee reportedly on the advice of Senator Mr. Nisar Memon:

Atragedy. He is known for his rabid anti-dam views and we remember the unfortunatesituation he had created earlier as Sind provincial minister. Both ANG Abbasi & Mr.

Nisar Memon had written a controversial Water Committee paper in 2000. In 2005 hedelayed his report compelling the other 7 members to submit their report independentlyof him in May 2005 while he took several months longer. He however ensured thatBhasha take precedence over Kala Bagh Dam (KBD) and recommended it to be acarryover dam without canals. Bhasha can have no canals for NWFP and Punjab.KBD is a never silting dam with 6.1 MAF live storage. Although smaller than Tarbelaits location is near perfect. Maximum flow of the Indus river occurs at KBD site asglacier waters and monsoon waters converge. KBD has to be operated in conjunctionwith its bigger brother Tarbela and smaller brother Bhasha for best results. Dams incascade allow release-hold sequence whereby the same water quantity is usedrepeatedly for power generation and the required irrigation releases are from optimum

locations. Are we going to remain at around 20 million tons wheat production forever?In March 98 Mr. Gupta of the World Bank visited me in the company of Dr. G.S. Buttand Mr. Khalid Mohtadullah (then member Water, WAPDA) and related the saga ofKBDs very extensive studies. It was reassuring to learn that ISO-14000 studies werealso done in 1987, which removed doubts about any negative environmental impact.The propaganda about sea-water intrusion, destruction of mangrove forests in the Indusdelta as well as impact on fisheries have all been thoroughly investigated. KBD isindispensable for Pakistans economy. The 4 April 97 letter of World Bank PresidentMr. James Wolfensohn recommends KBD as part of the least cost solution and a projectwhich could add significantly to Pakistans irrigation potential. The brethren of theNWFP have to finally appreciate that the extra-ordinary 1929 flooding of Nowshera

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was caused by an absence of a dam such as KBD. Instruments & communicationsystems would have allowed a draw down before danger levels were breached. Damshelp to control floods and do not induce them. The nation has not appreciated the roleof water reservoirs in the national economy. Some are playing politics and blockingprojects for sweet water storage under the tragic slogan of provincialism. WAPDAwhich used to give rupee loans to the GoP in the 1970s was burdened with excessiveelectrification by successive governments but was denied after 1974 the indispensable

multipurpose reservoirs. The Hydel policy 95 (a ministerial decision) and the NationalDrainage Policy 1997 have been bad precedents. Severe imbalance of irrigation &drainage has particularly created more water logging & destruction of irrigatedagriculture. The ominous Indian factor is clearly visible since 1947. RememberFerozepur Headworks! Do we comprehend? The Indians understand it very well.

5) It becomes important for us to calculate the financial impact of 1 MAF of additionalreservoir capacity in the IBIS : I am convinced it is now around USD two billion perannum on the nations GDP. KBD construction should have commenced in 1983/84 andcompleted in 1989/90. Therefore in the seventeen years that KBD could have beenavailable, the loss to the national economy due to the 7MAF KBD alone has been overUSD 200 Bn. Infact, the non-implementation of the 91 Accord means that after year 2000we lose cumulatively around USD 44 Bn per year. It is simple to check this thesis.Remove Tarbela (9 MAF reservoir & power generation) from the scene and Pakistanseconomy will shrink by 15% to 20% at todays GDP level, besides other implications.Remember the 1991 Accord allowed 22 MAF additional storages, half of which are to

replace the lost capacity of existing reservoirs.

6) The entire developing world is building dams. Indian activity is suspect: China hascompleted several thousands in recent years (total now around 22,000) including theThree Gorges Dam. The USA built 5500 dams and does not need more. It can afford todecommission some. India has undertaken 650 dam projects (over 4000 exist) includingthe controversial NIRMADA after the Indian Supreme Court decreed it. India has

launched in 2006 the USD 200 Bn Northern Reservoirs Linking project whereby in tenyears all reservoirs from East Punjab to Bengal would be interlinked. It is the world

largest ongoing irrigation project. This astounding project based on the Prabhu TaskForce Report is also known as the river linking project. A network of link canals toconnect all the rivers of India; Mahanadi to Godavari, Krishna to Godavari, Brahmaputrato Ganga, Narmada to Tapi, Cauvery to Vaigai. The task force included Mr. C D Thattewho is also the Secy Gen of the International Commission on Irrigation and Drainage(ICID). The ICID is an Indian think tank (NGO) established around 1950 by PMJawaharlal Nehru. Today ICID advises the World Bank and other multi-laterals onirrigation projects; appraisals & feasibilities of projects the world over!

It is our considered view that the dozens of barrages & dams under final stages ofconstruction in Indian occupied Jammu & Kashmir (some surreptitiously) with theirlow level gates (classified as silt excluders) are for the ominous purpose of water theft.The developed world does not need more reservoirs. They can talk of decommissioningof dams as their population shrinks. Please appreciate one of the most effective think-tanks on water policy for the multi-laterals is the ICID (International Commission forIrrigation & Drainage) which has its HQ in New Delhi. No doubt Indias JawaharlalNehru was a wise leader for his nation. Now the Indian influence on our regionalpoliticians has gone too far. The responsibility for interference in our irrigation systemdevelopment since 1947 would have to be shared by the Indian leadership, just as their

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open involvement in East Pakistans separation. This time the charge is water theftleading to a genocide of the Pakistani nation.

7) So-called lack of consensus on large reservoirs resulted in some quick fix privatethermal stations after 1994. Why is this nation addicted to imported oil?: The nowdiscredited CALIFORNIA model of private generation being discussed by IMF & WorldBank since 1988 was applied to block the public sector effectively from setting up newthermal & hydel projects. HUBCO preceded it. The 1994 Power Policy invited the IPPsand the public sector was instructed to abandon its own plans for new thermal powerstations. Only two thermal stations in the public sector were permitted to complete theirexpansion. Strangely the bureaucracy continued to ignore Pakistans 40,000 MWhydro energy potential. If the multi-purpose reservoir projects had been blocked by a

few provincial politicians the-run-of-the-river hydroelectric projects especially the high

head tunnel projects in the north should have been accelerated. WAPDAs balancesheet as a direct result of expensive power from IPPs started to become very weak.WAPDA was now buying thermal power, in some cases at 300% of its own thermalgeneration costs. Every few months some new or old ill-conceived proposal is thrown upto confuse and derail internal debate. One of the most preposterous hydro schemes is socalled 35MAF Dam in Katzara also known as Skardu Dam. Friends with knowledge ofthe Northern areas believe that this mega Dam can only be imagined at a site nearKachura some 18 km downstream of Skardu. Mr. A N G Abbasi, Chairman TechnicalCommittee on Dams has also given preference to this Dam site. Further proof that Mr.Abbasi does not wish Pakistan well. Firstly he expects to store the entire annual flow atthis nascent point. Naturally there can be no canals in the Karakorums. Secondly thisDam site is anti civilization as it would inundate / submerge the entire level soft soil areaof Skardu and Shigar making the area uninhabitable. The peoples of Skardu and Shigarvalley would have to be relocated. Even Skardu Airport would be under 1000 ft of water.In short the entire Balti civilization would be uprooted and their lands submerged. No

one would finance such a project. Only a mad man would permit such a project.

WAPDA as predicted is now unable to undertake major projects on its own balancesheet. A major handicap for the sustenance of the IBIS. The hydro based TVA modelhas been mutilated. Pakistan has become a water short country. Fresh rounds of thermalIPPs are now being permitted, creating a mortally dangerous situation. The tariffs areunsustainable for the economy. Competition with public sector is not even discussed;such is our anxiety for FDI. The final blow would come with privatization of dams.

8) Food Autarky: The IGC (International Grain Council) gave its first caution in August1997 when Chinas wheat production fell from 127mn tons to 104mn tons, the yearearlier. Fortunately the wheat production of the year 1997 / 98 did not fall from the total586mn tons level of the previous year. That year only 94mn tons were available for

world trade in wheat but the total stocks held were an adequate 103mn tons. Thanks toglobal warming, crop failures, drought and changes in crop patterns in Australia,Canada & USA and partly due to the use of crops for producing ethanol and biodieselwe see a severe crisis developing. The IGC estimate for 2005 shows that the peak inwheat production has been crossed and it was now downhill. Please note that the worldwheat production in 2005/06 was 620mn tons but it declined to 590mn tons in 2006/07.The consumption is estimated at 610mn tons. A shortfall of 20mn tons which is aserious depletion of world stocks! Prices for this reason have risen three times in last 5years. Prices doubled to USD 400 per ton in Jan 2008 from USD 208 in January 2007.The price situation with Coarse Grains such as maize, millet & sorghum is not criticalas our farmers have improved their yields.

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Price (CP) upto about 2 months. No wonder one of their gen. units is normally notworking. This is more concession than for other IPPs and far more than whatBangladesh allowed. In this period (late 1994) HUBCO made tremendous financialgains which took the project IRR much higher than 18%. The project costs of aroundUS$ 1.5 Bn (payable by WAPDA/GoP) is far more than the cost of equivalent 1292MW steam/conventional projects worldwide. The reference tariff has lacunae clearly tothe benefit of HUBCO/NP including exchange rate differentials at every stage of the

repayment. Strangely the relationship of HUBCO/NP and WAPDA/GoP is of afiduciary nature wherein HUBCO is responsible to render full accounts for the paymentcharged to and collected from WAPDA. The 1994 Energy Task force under Mr. RazzakDawood failed to give an upper limit for IPP participation.

10) HUBCO is Pakistans largest private company. Did anybody ever think of theconsequences under this agreement if the Pak Rupee was to collapse against the USD.Pakistan has intractable long term financial contracts with all IPPs under the 1994Pakistan Power Policy. With these private thermal projects the hydel:thermal ratio of70:30 which was considered viable for the economy was disturbed. It has becomelopsided (30:70) and worsening. Hydropower inherently suffers periodic lows due toexcessive variation in river surface flows. Ideally 100% hydel power would be perfectbut some thermal energy in the mix is unavoidable due to the surface flow variations.Through an avalanche of pro-IPP propaganda every detractor was sidelined. Try todiscuss the IPP menace and you will receive cynical silence.

11)Excess power capacity is also dangerous for a nation's weak economy: Howeverexcess private power (IPP) capacity is suicidal for the economy and the Federation. ThePrivate Power Policy '94 was an unrealistic and defective policy and furthermore itsimplementation was callous and brutal. National utilities have been financially crippledwith cold-blooded precision. Mr. Shahid Hassan Khan and his friends had committedserious economic blunders in the planning and implementation of this policy. Withoutrealizing the implications for the national economy they encouraged a stampede of

investors with an incompetent one-sided private power policy and ended up by issuingletters of support (LOS) for 27 Thermal Power Stations primarily on imported energy. Noupper ceiling was considered inspite of several cautions. Today we see the cripplingfinancial consequences due to a tariff related to imported energy. The twin menace ofofficial corruption and low efficiency cannot be blamed for the sudden collapse of bothnational power Utilities. The privatization of basic Utilities is not sustainable. Tariffs cannever be effectively reduced and the repatriation of dividends and profits has not allowedthe growth of GNP in tandem with GDP. The hundreds of closed industrial projects willincrease in population. In 2007 there was a USD 4.4 Bn black hole in power utilityfinances, impacting on the national Economy.

Sadly in the last two years we see shortage of electric power develop in the country.Electricity deficit during March 08 was approx 2500MW in a total Generation capacityof 20,000MW (WAPDA, KESC, IPPs, Captive power and PAEC). Regretfully the mixhas been made lopsided. Instead of the hydel: Thermal ratio of 70:30 outlined by thenational planners it is thanks to our addiction for oil now around 33:67. The thermalincludes Nuclear energy generated by PAEC. Regretfully generation based on coal isnegligible. Our 184 Bn tons of brown coal (lignite) reserves at Thar being stilldiscussed 40 years after the first serious report established its huge potential.

High tariffs in turn impede industrialization. A double whammy. Can we deny thatPakistans credit rating by Moodys or Standards & Poors had fallen to the lowest level

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technological training of our manpower we have created a dangerous combination. Letus analyze our technological / industrial legacy. The truth is that the Europeansintroduced Indians to the first modern industrial revolution. Muslim Mughal Indiainspite of its martial traditions had neglected the great traditions of early MuslimScholars in mathematics, general sciences and medicine. The occasional recourse toPersian architectural and building techniques did not herald a technological revolution.Europe had already started coming out of the dark ages and had commenced using steel

foundries together with molds & metal dies. The Muslims of North West India werebarely crawling out of the bronze age when a modern day imperial power overwhelmedthem and took control within a short period of history. One is acutely aware that Turk,Egyptian and Mesopotamian universities in the Islamic world were functioning inisolation but Indian technical institutes were altogether non-existent. The first modernuniversity in the Indian Sub-continent was established in 1857 at Calcutta, anddeveloped technical schools. Later, the Aligarh Anglo Oriental Muslim College wasestablished in 1875 exclusively for young Muslim men. It went on to become theAligarh Muslim University in 1920. The Zakir Hussain Institute of Engineering andTechnology was established under this University in 1938. Earlier in 1921 was foundedthe Dacca University of East Bengal, and soon had a technical institute. Access forBengali Muslim men was easier. It is a historical fact that the worlds first universitywas established in Takshila in 700 B.C. More than 10,500 students from all over theworld studied more than sixty subjects. The University of Nalanda built in the fourthcentury was one of the greatest achievements of ancient India in the field of education.This was the pre-Islamic era. Let us not forget that India was one of the richestcountries in the world till the arrival of the British in the early seventeenth century. Infact, Christopher Columbus was attracted to Indias wealth and was looking for a routeto lead him to it when America was discovered by accident. Tradition and family skillswere the vocational training pools of Mughal India. Having just lost their Americancolonies; later to be called the USA, the British forces came into Muslim India like anunstoppable tornado.They found, besides a milieu of cultures, religious and ethnicgroups, two distinct communities who had seen their days of glory and were now in astate of retrogression and decay i.e: Hindus & Muslims.Their contemporary state ofindustrial technology had regretfully a negligible connection with the Pre-Britishcolonial rule. The steel age arrived late in India.

The early East India incursions in a Westerly direction beyond Madras and Calcuttawere easy pickings for an organized and disciplined force. The period ofconsolidation followed. Thereafter a quelling of the so-called mutiny of the nativesin 1857 was swift, and in hindsight, most reassuring for the imperial forces. It was nowtime to re-educate the natives, and create the new eastern base for Her Majestys PaxBritannica. The Indian Muslims were a talented and intelligent people but they lackedmodern-day skills. The first University of British India (admitting Muslim students) at

Aligarh was established in 1875. The road network started around 1540- 1545 byAfghan King, Sher Shah Suri, was enlarged. The plains of the Punjab requiredscientific irrigation methods so the waters of the Indus Basin could be put to better use.Aquaducts using gravity were known to the ancient Indian. Pumping and basichydraulics were improved after the arrival of the Fresh addressers and expeditionaryforces. Not only were the hardy natives of the Punjab found suitable for agriculture, buttheir skills in metal work and carpentry convinced their new Imperial Masters that theindustrial engineering and forge/foundry techniques of Liverpool, Northampton and Newcastle could be supplanted here. Soon enough, the bulk of the textilemanufacturing processes of Manchester and Bradford were duplicated in the Lahoreand Amritsar belts of West Punjab (now Pakistan) and Indian East Punjab.

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The Hindu community was less resentful of the British conquest of Muslim India andassimilated quicker within this new culture of Europeanization. As a result, their per-capita share of the steel mills, machine tools and foundries was greater. In general,British India including the highly rated Industrial belt of what is now Pakistani Punjabbecame the springboard for the Pax Britannica Eastward Export Drive. Machine tools,diesel engines and irrigation pumps were by 1900 competing with newly emerging

industrial Japan in the markets of South Asia and South East Asia. These marketsincluded Burma, Ceylon, former Malaya and Indo-China. Feudalism in British Indiaremained a deterrence for industrial development. It limited the levels of educationexcept in the very closed urban areas.

The Second Industrial Revolution & Beyond (Pakistan Specific)

The second industrial revolution (in Muslim India) arrived some 50 years before thecreation of Pakistan in 1947. The steam drives of marine vessels and railwaylocomotives were being serviced at Karachi and Lahore. The magnificent NorthWestern Railway network (NWR) starting from Karachi to Peshawar via Multan,Lahore and Rawalpindi had side tracks to Quetta, Kundian (Mianwali) and Lyallpur(now Faisalabad). The British rulers developed all means of transport basically tosecure their volatile Western borders with Afghanistan & Czarist Russia. It broughtwith it the convenience of the first and even second industrial revolutions, sincemedium speed diesel engines were also deployed. The Internal Combustion engines ofautomobiles, buses and trucks were now in extensive use. Also, an airline industry waslaunched after the second World War, essentially managed by aviators from the military.Regretfully, the Government did not think it necessary to introduce the manufacture ofmedium speed and high speed Diesel engines or petrol engines- the kind that powerautomobiles and road vehicles. Abdullahpur (Lyallpur) was home to an important10MW Deutz Diesel power house, while Karachi, Multan and Rawalpindi had Diesel &Steam Turbine driven power stations. Half a dozen hydropower plants were created asan off shoot to the great irrigation system created in the Indus Basin. However, noefforts were made to induct/upgrade manufacturing skills in these sensitive spheres ofenergy converting machines inline with the neglect of internal combustion engines,electric generators manufacturing and dedicated metallurgical/ alloy labs. Whereas thefirst Engineering College in what is now Pakistan was established around 1925 atLahore (Mclagan College) there was no major attempt to upgrade manufacturing skillsafter World War I. The service sector was developed. The Tatas and Birlas expertisein steel making was inherited exclusively by India at partition of the subcontinent in1947. Private initiative in the Pakistani Punjab was based on levels of skill inmetallurgy existing at the turn of the century based on skills of the first industrialrevolution. This obsolete capability was doomed to die out in the export markets andwithin 25 years after partition even the locals were wary of these primitive and archaicmachines. After the creation of Pakistan, the Military and Aviation Industries during the1960s and early 70s, managed to master the maintenance aspects quite proficiently.However negligible import substitution was attempted through in-house workshopsbasically due to the lack of volumes and attitude of the bureaucracy. This attitude of thecivilian bureaucracy has been endemic. The shackles of the feudal mind-set remains amajor hurdle towards industrialization. Pakistan remains a society dominated by thefeudal culture although the urban centers are now superficially liberal & modern.

The Textile spinning and weaving institutes also made a brave effort in the 1950s &60s to learn the craft and maintain the imported machines. A power distribution

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Industry was created with indigenous manufacturing of power & lighting cable, meters,fans, lamps and accessories. Separately medium voltage distribution transformers &basic switchgear was assembled / manufactured. However indigenous design capabilitywas very limited. Tragically, the era of the transistor which ushered in the electronicage, the age of analog computers and, of course, the arrival of digital computers in thelate 60s, was completely missed out on. The end of the second global industrialrevolution in the 1960s and early 70s saw worldwide great advances in electronics,

material, sciences and metallurgical processes. Pakistan totally missed out on thisaspect of the second industrial revolution and was therefore ill equipped for the thirdglobal industrial revolution. The revolution that brought automation of industrial processes and manufacturing in the world to a level of great efficiency, speed andaccuracy. Technology incubators would be needed to catch-up. We dont realize it.

14) Global warming. Great Floods are predicted. Grain Output worldwide is falling: Letus understand that worldwide over 6 Bn tons of CO2 is emitted every year into theatmosphere. The greenhouse effect caused by an invisible blanket has resulted in anaverage 0.7oC rise. Glacier melt has increased exponentially around the world since 50years. The Polar caps began to shrink dramatically as well. Our sweet water supply is70% fed by the mighty glaciers. Without several new reservoirs we are not prepared forextra-ordinary flooding & non-seasonal flows expected over the next 25/30 years. Sweetwater once lost by the glaciers is not recoverable. As a result of this modern menacenearly 50% of glacier retreat has already occurred (around 33% loss of surface area).Switzerland tried to cover the alpine glaciers with plastic fabric, unsuccessfully.

15) Indias genocidal war through water theft: The foregoing analysis confirms that weare since 1947 being subjected to a life & death struggle by India, the upper riparian.Indias war has been surreptitious. The role of the Americans at the incipient sages ofthe nascent dispute has been humane and statesmen-like. The brilliant article of Mr.David E. Lilienthal as reported on 4 Aug 1951 having the title ANOTHER KOREA INTHE MAKING was attached to the letter sent by IBRD (World Bank) president Mr.

Eugene R. Black on 6 Sep 1951 to the Prime Minister Mr. Liaqat Ali Khan. The IBRDinitiative was benign and timely. The subsequent events leading upto the signing of the19 Sep 1960 Indus Waters Treaty at Karachi between P.M Mr. Jawaharlal Nehru &President Ayub Khan are well recorded in Mr. Bashir A. Maliks book Indus WatersTreaty in Retrospect. The IBRD acted as Facilitator and Guarantor for the Treaty.However the Indian mindset & machinations were beyond the comprehension of peopleacting as honest & concerned brokers in this deadly water game. The Indian effort hasbeen so comprehensive and total that it can only be described as war for water which isleading to a genocidal phase for the loser. Regretfully Pakistan is at the receiving end.An army of fifth columnists now stalk the nation opposing every effort to build the life-sustaining reservoirs on the Indus river. Who is motivating & financing this vicious and

dangerous enterprise against the people of Pakistan? Do we care to know?

16) The mix of incompetence, institutional greed and nations lost opportunities:Scientific thought & discipline are not in style here. The Poverty cycle could not bebroken here especially due to the fact that the political leadership was generally lookingfor short-term gains. The bureaucrats are part of the problem. For every efficient andpatriotic bureaucrat there is some one who is working on a personal agenda. We coulddeliberate on why it took 30 years to have a steel mill. Why this steel mill is based onimported iron ore, when the Germans had demonstrated that Kala Bagh ore togetherwith a mix of Pakistans coke could have been made functional. The family, dominatingsteel trade, responsible for this national tragedy is known to most of us who have

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studied Pakistans development history. The failure to build multi-purpose dam projectson the Indus main stem after 1974 (Tarbela) is perhaps the biggest economiccatastrophe in our history. Let us look at some recent examples where impulsive &arbitrary decisions resulted in major setbacks to the nation. The rogues are still active.

In Dec 2001 during the second visit of President Musharraf to PRC several MOUs weresigned for run of the river power projects with various PRC engineering & constructioncompanies on a turnkey (EPC) basis. WAPDA had invited reknowned PRC corps toassist Pakistan to take a leap forward within the objectives of the VISION-2025

program launched in July 2001. The invitations were sent in Nov 2001 inviting PRCgroups to agree to sign hydropower MOUs in the presence of the President of Pakistanwho was to make a state visit in third week of Dec 01. Within the MOU draft each PRCsupplier/contractor received a reference price for the EPC (turnkey) project for whichsuppliers credit would be arranged by the individual supplier/contractor. ThereforeWAPDA solicited and invited partners. The author of this hydel campaign, known asWAPDA VISION-2025 and launched in July 2001 was Lt. General (Retd) Rao ZulfiqarKhan a clean, hardworking Chairman of WAPDA since late 1998. His quirk being thathe was somewhat distrustful of contractors of all shades. The PRC groups showedexemplary cooperation. Only one MOU for the 96MW low head Jinnah Hydel on theJinnah Barrage became a contract with M/s. Dongfang in Nov 2003. It is underconstruction. The final cost allowed USD128 m+. The PRC Exim credit at reduced 5%interest p.a. The P.S. has a high plant factor as it utilizes part of the main Indus flow.Clearly Dongfang was favoured by both sides.

Three other Hydropower MOUs were signed in presence of the President. With M/s.Sinohydro Group for Golen Gol 106MW (Upper Chitral), CMEC Group for several lowhead canal based P.S. in Punjab (totaling around 80MW) & with CGGC/GezhoubaGroup for Keyal Khwar 130MW (Kohistan). A small but significant initiative to startexploiting the 40,000 MW hydropower potential which our nation had identified.

Indeed future generations will be unable to understand why we could not find a

quicker way to use this hydel potential, known to us since 1960s.

Second MOU was for Golen Gol. Sinohydro the largest hydropower construction groupof PRC approached WAPDAs management in mid 2002 after realizing that their MOUincludes around 125 km of 132 kV transmission line (over a very harsh terrain) forwhich they would require another USD27 m above the MOU price of around USD90mEPC. It is clarified that EPC is the technical description of a turnkey contract where prices are fixed during the period of the contract and therefore escalation is notprovided for. Yes 85% foreign currency financing was to be brought from PRC EximBank on a standard commercial 12/15 years format. Sinohydro was refused thelegitimate extra money requested for the 132kV transmission line and WAPDA

cancelled the MOU. A national tragedy to be soon repeated on the Gomal Zam Damproject in bloody Waziristan. WAPDA lost friends in the most critical developmentsector and therefore it was a national tragedy. Vision 2025 did not start well.

The third was CMECs MOU. This corp realized that the MOU value was grossly underpriced. Again WAPDAs bureaucrats saw this as a trick for price enhancement andrejected their request. The fourth & last group was also under price pressure. CGGC /Gezhouba group were motivated to stay in the arena as WAPDA kept telling them thatthe mega tunneling project Neelum-Jhelum 969MW would be their reward if theywould agree to work on the tentative price level of their respective MOU. CGGC beingeffectively the second largest hydropower construction group of PRC was incidentally

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the lead contractor of the Three Gorges Dam, the worlds largest hydro project(completed in 2005). They agreed to work within the MOU tentative price and evenagreed to complete the unfinished feasibility. This engineering task they were able tocomplete with their own resources in 10 months, around Oct 02. Their trial began.

The genesis of problems for Keyal Khwar Hydropower Project (HPP) the 4 th hydelMOU began with the NWFP SHYDO organization resolution. In violation of the 1995Hydel policy, the Power Generation policy 2002 as well as the 1973 Constitution ofPakistan they refused to recognize the 130MW Keyal Khwar HPP as WAPDA / GoPdomain. A sovereign MOU having been signed on 24 Dec 01 with a PRC Group in thepresence of the President of Pakistan. The NWFP SHYDO Board under Chairmanshipof CS, NWFP Mr. Shakeel Durrani suddenly decided in Jan 03 to construct from itsown resources the Keyal Khwar HPP. The MMA government of NWFP supported theCS, inspite of the fact that Chairman WAPDA had an agreement with Governor NWFPon 28 May 02. Minutes recorded under SO (Dev)/6-S/20025667-81 dated 05 June 02.NWFP did not withdraw its letter of Jan 03 to the Planning Commission Islamabad. On27 Sep 03 the ACS, NWFP asked for adjournment of this agenda point at the firstECNEC meeting during discussion of Keyal Khwars PC-I application. This was ablatant violation of the Constitution of Pakistan which permits power generation byprovinces if they can self utilize the power. Keyal Khwar HPP is a remotely locatedpeaking plant and therefore can only be integrated with a large Utility network. Selfutilization requires Base Load Plants with a high plant utilization factor as near aspossible to the load centers to avoid high transmission costs. Also under the PowerPolicy of 2002 the Provinces/AJK have jurisdiction on projects upto or below 50MW.Therefore even if WAPDA had not signed a sovereign MOU with a PRC group in Dec01, the provincial authorities of NWFP could not demand to execute this remote130MW project. The CS NWFP was determined to have a confrontation when heinitiated the SHYDO decision. The dispute started by CS NWFP Mr. Shakeel Durraniin Jan 2003 subsequently disturbed the project schedule by over eight months and laterled to the illogical ECNEC decision (in Jan 04) ostensibly due to interest rates.

On 07 Jan 04 for the second time Keyal Khwar 130MW high head MOU projectreached ECNEC and was rejected inspite of the contractor CGGC having agreed withWAPDAs demand for the original MOU cost of USD 100m (EPC / fixed price). Hehad completed additionally the engineering feasibility from his on resources. CGGChad not been able to arrange for the Exim Loan interest rate to be reduced below 5.5%.Keyal Khwar HPP was a US 2.17 per Kwh power generating project. Such a lowgenerating costs inspite of short time peaking capability. No one in ECNEC includingWAPDA engineers had the acumen to speak-up. How could the NPV be poor if a US2.17 project has a slightly higher interest rate loan? This project with a 700m + headwas to be basically a peaking project i.e. operating about 6 hrs in 24 hrs. The

generators being driven by two pelton turbines each receiving 11 cumecs of water flowfrom the small storage yet produce nearly half billion units of power per year. It was tobe close to the three similar projects being constructed by WAPDA nearby (DuberKhwar 130MW, Khan Khwar 72MW and Allai Khwar 120MW). Khwar is a Pashtoword for nullah and here these are tributaries feeding the Indus. The delay caused bythe NWFPs intense objection definitely had weakened WAPDAs resolve besidesdelaying the approvals. The year 2003 /04 saw a lower interest rate scenario andresulted in the Finance Ministry making this comical objection to the project in thesecond ECNEC meeting of 07 Jan 04. Inspite of an excellent feasibility with an energytariff of US 2.17 cents (with financial costs) it was rejected after reaching ECNEC. Agreat technology demonstrator was delayed and Vision-2025 crippled. Mr. Shaukat Aziz

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and some of his financial wizards began to show quixotic tendencies during this period(2003-2006). Clearly the inflow of financial aid, grants & renegotiations post 9/11 hadgiven them a false feeling of euphoria & well being. There was a brief period when hehad declared that no loans above 5% p.a. will be acceptable. He even set about toterminate loans in the pipeline above 5% p.a.

Clearly the CS, NWFP Mr. Shakeel Durrani had challenged the Federal PowerMinistrys jurisdiction. NWFP was not willing to respect its own minutes of June 02.Keyal Khwar after construction by WAPDA was to become an asset of NWFPproviding the social and economic benefits to Kohistan. It was to be a pioneeringproject able to serve as a high head technology demonstrator to unlock the huge hydelpotential of the Indus-Kohistan region. In late 2004 after the ECNEC decision to ignorethe PRC MOU the NWFP Authorities gave up their claim to construct Keyal KhwarHPP. Not only 4 years of low cost high head hydel generation were lost but anopportunity to purchase a hydel project at USD 0.75m per installed MW is

irretrievably lost. The EPC / fixed price level unheard of in 30 years. The PRCcontractor was never compensated for the feasibility studies. The German KFWAuthorities quickly offered to finance the project and preparations for tendering areafoot. Cost of the project will now be nearly double. WAPDA and the nation has lostincredibly but who cares?

17) Sad events at Pak Railways : Coincidentally this example also concerns Mr. ShakeelDurrani when he served his first term as Federal Secretary Ministry of Railways &Chairman Railway Board from Oct 04 to March 07. He quickly convinced himself thatthe Rohri to Lahore Modern Signaling Project was wrongly awarded to CMC a PRCCorp. and withdrew unilaterally the LOI without any formal enquiry. He refused toaccept that there had been four rounds of tendering between Aug 01 and March 03. Heignored the fact that the Railway Board had approved it. CDWP had recommended theproject on 24th Jan 04 and finance ministry had approved the revised commercialpackage / loan in early July 2004. He took an arbitrary decision and had the audacity to

send a diabolical & false memo to the President in Oct 05 when the CMC local repwrote a memorandum to the President that Pak Railways unilateral withdrawal of theModern Signaling LOI was the cause of the triple train collision on 13 July 05 atGhotki/Sarhad station in Sindh. Perhaps the worst train accident in railway history. Mr.Durranis memo is based on a draft/unsigned estimate of a competitor. In tandem he fedfalse technical information to the Planning Commission and succeeded to stall theformal approval of the PC-1 by ECNEC so that the formal contract may not be signed.CMC had been awarded the LOI on 03 July 03 by the full Railway Board tendercommittee. An Agreement for Award of Contract was signed in the Great Hall ofthe People on 03 Nov 03 in the presence of the Honorable Presidents of both

countries. A culmination of the Railway Modernization and Rehabilitation Plan

agreed during President Musharrafs first State visit to PRC in January 2000. TheRohri-Lahore PC-I was withdrawn in 2005/6 on Mr. Durranis instructions from thePlanning Commission and divided into 4 smaller sections. New tender costs received in2007 for 2 sections Lodhran-Khanewal-Lahore (435 km, 31 double line stations) showa shocking escalation of the project. Around 270% above CMCs agreed rates of 2003.

The key technology offered by apparent lowest bidder BT (Bombardier) in 2007 isidentical to what was offered by CMC in 2003. BT was infact a nominated subcontractor in the CMC tender / LOI / pre-contract Agreement. CMC refused toparticipate in the 2007 tenders. The comparisons in cost of the CMC Agreement dulyrecommended by CDWP on 24 Jan 2004 and the 2007 tender prices show a price

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difference of effectively 270% or more above the CMC Agreements price level of 03Nov 2003. The CMC scope of work had covered + 810 KM, 65 double line stations.The total cost with BT interlocking for stations and 250 locomotives equipped for mainline auto-block signalling was USD 110.8 mn. Tenders in 2007 cover 435 Km, 31double line Stations and 160 locomotives equipped for auto-block signalling at a cost ofUSD 137mn. Again the nation suffered due to a bureaucrats arbitrary style & hisapparent mistrust of China. Was he following instructions to discourage Mouization!

Mr. Durranis historic remarks to the PAC (& AG) investigation on the PRC supplieddiesel electric locomotives, were a great shame as he attacked his predecessors withoutrealizing these locomotives were encountering minor teething problems (floor cracks &ventilation issues). He now threw out a great opportunity since 1947 to modernize themainline signaling between Rohri to Lahore at a cost which was less than 50% of worldprices. The Diesel Electric locomotives he criticized so blatantly were purchased at afraction of international prices. The Economic crimes committed by Mr. Durrani have perhaps no precedent in bureaucratic annals. Was it greed or incompetence ormegalomania? Subsequent advice by Fed Minister Sheikh Rashid Ahmad to let thedecision be taken on new tenders is a shameful cover up. The man who proposed inSep 06 the bullet train between Lahore to Rawalpindi and even advertised for itsExpression of Interest cannot be declared innocent of the criminal negligence with theCMC Modern Signalling Agreement signed in the Great Hall at Beijing.

18) Market ethics & practices: The ethics & practices of the Pak market are alsoseriously flawed. Perhaps it is the only market in the world where fakes & sub-standardproducts are produced or imported with impunity. In most cases the buyer is aware thathe is purchasing poor quality. There is no institutional control. Both public & privatesectors are unable & unwilling to speak-up. Low prices are encouraged at the cost ofquality & safety. The # 2 Syndrome is an all pervasive and disruptive mindset. Easymoney is the mantra. Are the institutions including the PEC willing to change thesepractices? Let us prepare an electric fire manual and educate people to avoid the firescaused by poor wiring and fake protection equipment. Genuine 99.9% electrolytic

copper, good earthing practices & leakage current control being critical.

The market credit system within the trading community especially in the engineering &materials area is scandalous. Just as predators like alligators & sharks stalk their prey inwater the merchants & stockists await the nave & fresh blood. It is a vicious dog eatdog story that has destroyed lives & businesses. I estimate that more than 50% ofreturning expatriates fall prey to these predators. It dampens entrepreneurship andmarket goodwill. The market place which has an abundance of fly by night tradersand quick money artists will never be a happy land. The media ignores this malady.

The situation of the steel re-rolling industry is probably the most disheartening. Based

on scrap melting it can only compete through electricity theft. The load shedding ofwinter 2007 / 08 has made this industry absolutely untenable. Prices have doubled.Since the partial collapse of our ship breaking industry near Karachi on the Mekrancoast line we are dependent on imported steel scrap primarily shredded ISRI 211. Wehave already a very low consumption of steel per capita. In India during 2004 theyutilized 35mn tons per year. This was around 30kg per capita. The Indians have a targetof 200mn tons by 2020. Assuming that their population remains static this would be anincrease of nearly six times in 16 years. China used 300mn tons in 2004. ThereforeChina already achieved 300kg per capita. Pakistan has per capita utilization belowIndia. During a lecture in Dec 98 at the GHQ after Armys takeover of WAPDA, I hadadvised the COAS that please consider electricity theft as a GoP subsidy and eliminate

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this evil in steps. Attempts to stop it overnight will bring chaos in the market. Givethem a year to clean-up. As an example; the max axle load of trucks if enforced willresult in very few trucks on Pak roads. Bad habits take a little time to change.

19) The health, pollution & sanitation issues: First requirement of civilization is cleanwater and effective sanitation. We pay lip service. We keep our house clean and throwthe garbage on the street. The belief that running water is clean even if it is sewage orindustrial effluents, is very dangerous. A Unicef report states that worldwide; safedrinking water & sanitation are basic to human survival, dignity & productivity. Lackof these fundamentals is one of the main underlying causes of malnutrition, disease anddeath in children. Over 1 Bn people including millions of children lack access to safedrinking water. More than 2 Bn people lack access to sanitation. Pakistan is amongstthe worst in Asia. Hepatitis is rampant. TB is re-emerging.

Pollution is the other menace resulting from auto & unchecked exhaust. Particulatematter (PM) should not be more than 70 micro grams/cum. PM is a complex mixture ofextremely small particles & liquid droplets. It could include nitrates & sulphates,organic chemicals, metals & soil /dust particles. Also acceptable Nox standard is 40 butin city centers including Lahore it is around 100. Nox is the generic term for a group of

highly reactive gases all of which contain nitrogen & oxygen. It is primarily a result offuel being burnt at high temperatures. High arsenic content in ground water is veryharmful and caused by unchecked effluents. We all understand that PM, Nox & Arsenicare responsible for severe health problems and countless mortalities.

In Pakistans 50,000 + villages, 1,000 + towns and major cities we find that pools ofstagnant & dirty water create millions of colonies for mosquitoes (& flies). Unioncouncils, town committees & municipalities have stopped trying to eliminate thismenace. Again Indians and Chinese are doing better at fighting malaria because in thevillages all three nations lack drainage infrastructure. In India they may not be able toprevent the malaria parasite but are developing health centers to destroy it within 24

hours of infection to avoid complications. The Chinese whose generally cool weather ishelpful use new malaria parasite killers such as Atamisanan plant.

Prenatal care and gynae centers in villages and rural areas are non-existent. Traumacenters for accident victims & other injuries are only available in few hospitals withinthe large cities. The mountainous regions of Pakistan are also suffering from all theabove shortcomings as the rural areas of the plains. Where there is no piped water thewater-borne ailments such as diarrhea are rampant killers.

It may be appreciated that President F. D. Roosevelt under the new Deal of 1932 hadinvested heavily for malaria control in the swampy areas of the TVA seven statesregion. To facilitate and encourage the settlers, extensive malaria & disease preventionwas considered as important as water resources & fertilizer production.

20) PPIB (Private power & Infrastructure Board Islamabad): Since its creation in theearly 90s this organization has been used firstly as a project office of the FederalMinistry and as a convenient bypass of WAPDA. The official objective being verynoble i.e: to provide a one-window facility to Investors from the Private sector. Themanner it has been used is open to debate. It has also been exceedingly popular withFederal Minister Mr. Aftab Sherpao in the period 2002-2004. Later his successor Mr.Liaqat Ali Jatoi has also found it a convenient organization. To everybodys surprisethey have offered two rounds of hydel IPPs in the last 3 years. Several investors cameforward for projects in the 50MW to 700 MW range. The sovereign site risk guarantees

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as demanded by the investors will never be possible for the PPIB to offer. There is ageological site risk and a hydro flow site risk factor. PPIB due to obvious politicalreasons will avoid the hydro flow site risk. This is a dilemma and I do not visualize anyserious headway unless the hydel sponsor does not want site guarantees. The mostillogical hydel project which PPIB recently tried to attempt was the 960MW Tarbela 4 th

Extension in 2006 / 07. Only a bandit could have attempted such a private project onPakistans only mega dam on the Indus main stem. Who will decide the water sharing

between the public sector and private sector power houses? Dams may not have twopower houses. There are several safety issues as well. No wonder that a clean man likeMr. Khalid Rehman resigned in 2007 the M.Ds Post at PPIB. The decks were keptclean for arrival of the man who has the blessings of the Presidency.

21) Nepotism: Attrition of human resource has for long been a major drag on Pakistansdevelopment. It is part of the worldwide brain drain phenomena where developingcountries continuously lose their educated youth to the developed world. Economicfactors are normally predominant in this decision to migrate. However nepotism, lackof justice & lack of job opportunities for the educated are also major factors fordisappointment of our middle class youth and also the elite. I rank nepotism as the mostunacceptable form of behavior. Yes we have a feudalistic culture but some methods

used at different levels of Government can only be described as immoral & cynical.Here below is an example of nepotism by the head of state.

Mr. Fayyaz Elahi, former WAPDA Xen Mechanical (Coal Power Station Directorate)under GM Thermal is a charming personality. His credentials are however based on theworst kind of nepotism and intrigue. He is from Burhan (District Attock) and passed hisHigher Secondary (F.Sc) in second division. Through official influence of then inservice Lt. Gen Jahan Dad Khan, a friend of Mr. Fayyaz Elahis father Major (Rtd)Mehboob Elahi he became a Pak Army engineering cadet also known as DN (Defencenominee). According to unofficial information Mr. Elahi obtained his B.Sc. MechanicalEngg. degree in second division in approximately 7 years instead of the scheduled 4years. However he did not serve the Army for a single day in uniform. Uncle Lt. Gen

Jahan Dad Khan arranged for his release on compassionate grounds.

Mr. Fayyaz Elahi while a student married Miss. Raheela, who is a first cousin sister ofPresident Musharraf. The remarkable fact about Mr. Fayyaz Elahi is that after a veryshort spell of service in WAPDA Faisalabad Thermal Power Station he arranged in1977 through uncle JD Khan for his transfer to Head Office Lahore. He managed tospend the next twelve years on appointments within WAPDA Head Office Lahore.Having a good command of the English language he was selected for training in USAwith a group of major coal thermal power consultants. In this period he befriended Mr.MK Malik Joyya, the proprietor of M/s. Ravi Motors, M/s. Emkay Corp, M/s. JoyyaEnterprises. Mr. Joyya a childhood friend of Dr. Mehboob ul Haq had been introduced

in 1985 to WAPDA business as well as some major PRC corporations. Mr. MK MalikJoyya received orders in 1986 for Chinese units 3x210MW for Jamshoro P.S. and in1987 for 150MW Lakhra Lignite coal P.S., this time for Dongfang China. All orderswere received by Mr. Malik Joyya on exclusive negotiation or single tender basisthanks to the patronage of Finance Minister Dr. Mehboob ul Haq. Mr. Fayyaz Elahi wasWAPDA Xen Head Office Coal Power Stations responsible for coordination ofnegotiations between Dongfang Corp and WAPDA during 1987. This lignite coal firedunit has never become fully operational. The main problem being poor design of lignitehandling systems & combustion control.

Mr. Fayyaz Elahi was transferred in late 1988 to Faisalabad P.S. He immediately tooklong leave after few months of absence and joined M/s. Ravi Motors / Emkay Corp. as

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project coordinator of Lakhra Lignite Coal P.S. under construction by Dongfang. In thisperiod he was able to secure Canadian Immigration. He returned to WAPDA serviceafter about 18 months. Through contacts of Mr. Malik Joyya he succeeded around 1990to be transferred on secondment as Deputy Secretary, Federal Ministry of Water &Power Islamabad. On the sudden passing away of Mr. Tanvir Azhar, Director Generalof Private Power & Infrastructure Board (PPIB) in Jan 95, Mr. Fayyaz Elahi began tomanoeuvre for this high profile job. While PPIB was under the Federal Ministry of

Water & Power the job requirement was post graduation and relevant experience. Mr.Elahi lacked both qualifications but due to the great influence of Mr. Malik Joyya overPresident Leghari he was able to secure this job. Before the fall of Mohtarma BenazirBhuttos second government in Nov 96 Mr. Fayyaz Elahi escaped to Canada reportedlyvia Thailand with a large sum in cash. He had earlier boasted to his friends that someinvestors in PPIB unable to achieve financial close had forfeited their performancebonds. Mr. Elahi had proposed a way to arrange refunds under mutual arrangement. It isnot known if anyone benefited but Mr. Elahi received some huge advances from projectsponsors. The PPP Government was pursuing him when Lt. Gen Pervez Musharraf,Corps Commander of Mangla Garrison assisted him to leave Pakistan by being able toconvince President Farooq Khan Leghari of Mr. Elahis victimization by the politicalGovernment. President Leghari as Minister of Water & Power in the first PPPGovernment had been involved initially for Mr. Fayyaz Elhais transfer from WAPDAto post of Dy Secy at the Ministry. Clearly Mr. Elahi had not resigned his PPIB job norhanded over under the required procedure. Since the takeover of Gen Musharraf in Oct99 Mr. Fayyaz Elahi has been coveting this job. Otherwise as an associate of Mr. MalikJoyya he remained fully involved within Pakistan during the military rule. Mr. FayyazElahi returned as M.D PPIB in early 2008. Clearly his two major qualifications. Firstlybeing a longtime friend of Mr. Malik Joyya and secondly the fact that Mrs. RaheelaFayyaz Elahi is first cousin of President Pervez Musharraf.

Mr. Fayyaz Elahi has actively helped Mr. Malik Joyya in negotiating without tendersthe PEPCO contract for Nandipur 425MW+ combined cycle P.S. based on GE Gas

Turbines to be supplied by Dongfang. Mr. Elahi is also a PEPCO Board Member, byvirtue of his PPIB job. A happy coincidence for both friends. Mr. Elahi is nowendeavoring to place a similar 525MW order on Dongfang for CKM site. Mr. FayyazElahi and Mr. MK Malik Joyya are old friends and PPIB is the best platform for playinggames. We would all clap and say hip hip hurrah if PPIB would not have the reputationof being the nations dirty tricks company, created & used to destroy the nationalinstitution; WAPDA leading to ever greater financial haemorrhage.

22) Educate, understand your assets/endowments & strengthen national institutions:This is only possible when the elite and the educated are able to educate the youth and thenation a

Documents

Why Pakistan’s Economy Could Not Become Self-sustaining by Suleman N. Khan