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$18bn Penalty Feared if Pakistan Doesn’t Complete Iran Gas Project

The Public Accounts Committee expressed concern on Wednesday that Pakistan would have to pay a staggering amount of $18 billion in penalty if the country did not go ahead with the Iran-Pakistan Gas Pipeline project.

“The US should pay the penalty if it does not approve of Pakistan and Iran going ahead with the gas pipeline project. The USA will have to do away with double standards — being lenient with India in meeting its energy needs while punishing Pakistan for the same,” said Public Accounts Committee (PAC) Chairman Noor Alam Khan.

The observation came after the Ministry of Foreign Affairs (MoFA) informed the PAC through a letter that a meeting with the US ambassador would be arranged after his return from Washington.

The letter was in reply to a concern arising out from deliberations that the PAC held on March 1.

PAC chairman says US should pay fine if it continues to block pipeline deal

The ministry said: “In view of great importance of the Iran-Pakistan (IP) gas pipeline project in the emerging regional situation, this ministry has been exploring all possible options, including close engagements and meaningful exchanges with relevant parties, including Iran and the USA.

“In this regard a technical team from the petroleum division visited Tehran in January to discuss ways and means to proceed with the IP gas project. The Prime Minister’s Office has held inter-ministerial meetings of all stakeholders and agreed on an action plan to proceed on the IP gas pipeline project.”

In reply to a question on the purchase of petroleum products from Russia, the foreign affairs ministry said an agreement had been signed with Moscow for purchasing a test cargo of crude oil which would be reaching Pakistan soon.

“Pakistan was committed to the Pak Stream Pipeline project. The two sides are negotiating outstanding issues,” the ministry said.

Recovery from petroleum firms

The committee directed the ministry to recover “money embezzled” by two petroleum companies that had caused big losses to private investors and the national exchequer.

The two companies, Byco and HASCOL, have yet to return in full the looted public money.

The PAC members were shoc­ked to learn that the owners of the two firms had managed to leave the country even though their names were placed on the exit control list. The meeting was infor­med that Byco owed Rs 57 billion to the exchequer, but only Rs3.9bn had been recovered so far.

Expressing his displeasure over the meagre recovery, Noor Alam Khan observed the committee had already directed the Petroleum Division not to show leniency in recovery of the embezzled amount, but they were holding talks with the defaulters.

The PAC reiterated its directives about action against the two organisations for recovery of the looted amount.

Noor Alam directed the Federal Investigation Agency (FIA) to arrest the owner of Byco and seize his properties. “Sell his assets to recover the embezzled amounts,” said the PAC chief.

Meanwhile, Byco said that it was a simple matter of “payables vs receivables” since different government entities owed Cnergyico Rs79bn. The company said that the matter was sub judice, adding that it was currently in talks with the government for reaching a settlement.

Through another directive, the PAC asked the petroleum ministry to withdraw Rs500 in adjustment fee from gas bills in order to lessen the burden on the poor.

The PAC also proposed withdrawal of the ban on installation of new gas meters because “it encourages theft”.

Noor Alam Khan directed the office of the Auditor General to provide details of perks and privileges being given to the President, the prime minister, federal ministers and bureaucrats.

He noted that the Auditor General had not provided information so far about salaries and perks of senior officers of the armed forces.

Source : Dawn