Thursday, January 22, 2015

Daily Times Editorial Jan 23, 2015

Damage control With Prime Minister (PM) Nawaz Sharif personally taking charge of overcoming the petrol crisis, the situation has started to improve. Reports say petrol supplies have been diverted to Lahore at the expense of the rest of the province. Whether there is any weight in this assertion or not (the rumour mills have been working overtime since the crisis started), it is undeniable that the country as a whole has seen the lines at filling stations reduce. There are still areas of the country awaiting a similar easing, but the overall supply situation is definitely improving and more is on the way. The petroleum ministry has drawn up a plan for the demand/supply equation till February 28. However, despite imports, some of which have arrived at Karachi port, some are on their way upcountry, and more ships bearing oil are expected by end January, only 59,100 metric tonnes (MT) of petrol will be available till January 31. The usual average supply of petrol for the country as a whole is around 12,000 MT per day. But that was before the shortage hit. Imports of oil of 0.25 million MT are planned but the Letters of Credit for five cargoes in February totalling this amount could not so far be opened because of funds constraints. The petroleum ministry says at least Rs 70-80 billion need to be released by the finance ministry and the power sector within three days to meet the objective. The oil refineries too are cash-strapped because of circular debt and therefore only able to offer 35,500 MT in February, 16,800 MT below capacity. The monitoring room set up in the petroleum ministry is giving the PM daily reports on the supply situation. On Wednesday they reported 18,000 MT had been supplied, 6,000 MT over the norm, which may explain the easing. Meanwhile, taking cognizance of the serious damage to the government’s credibility because of this debacle, the PM has cancelled his trip to Davos, Switzerland for the World Economic Forum. He has also ordered that reserve stocks of petrol be increased from the normal 20 days to two months to ensure such a crisis does not recur. On the other hand, the Indus River System Authority (IRSA) is reportedly under pressure from the National Transmission and Dispatch Company to increase water discharges and thereby help boost hydel power generation to control load shedding, which is currently running at 12-14 hours a day in urban areas and more than 16 hours in rural areas. IRSA has so far increased discharges by 5,000 cusecs a day until January 25, when Mangla Dam will add an additional 10,000 cusecs per day in response to higher irrigation demands from the provinces and the reopening of canals closed for annual maintenance will boost hydel generation from 700 to 1,500 MW by January 31. The energetic response of the government to the crisis has to be praised. What looked like a crisis that would linger for weeks if not months has largely been overcome within days. This would perhaps not have been possible without the PM taking charge, an outcome to be expected after the incredibly inept performance of some concerned ministers. Unfortunately, these ministers are still being shielded and another scapegoat in the form of the chairman OGRA is about to have a reference sent against him to the Federal Public Service Commission to take action against him. This evasive approach will not help the government; on the contrary it can be argued it will weaken its battered credibility even further. Even within the ruling PML-N ranks, voices are being heard that emphasise the necessity of sacking a minister or two or at the very least changing their portfolios so that the government, or at least the PM, is seen as taking responsibility. Awkward as such a course may be for Nawaz Sharif, given the blue-eyed status of these ministers responsible for bringing the image of the government crashing down into the dust, he must weigh the costs of inaction against the painful necessity to hold his ministers accountable for gross neglect, inefficiency and passing the buck.

No comments:

Post a Comment