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Friday, April 12, 2024

From problems to ‘problematic’ projects

Ministry of Economic Affairs declared 70 percent of federal energy projects as ‘problematic’ and stressed on continuous monitoring

On Thursday, the Ministry of Economic Affairs declared 43 per cent of about $35 billion worth of foreign-funded energy related projects as ‘problematic,’ based on their unsatisfactory progress or inability to produce desired outcomes.

Sardar Ayaz Sadiq, Minister for Economic Affairs, headed the meeting, which was also attended by relevant ministers and provincial government representatives, as well as the heads of implementing agencies.

At a National Coordination Committee review meeting on foreign-funded projects, the ministry mentioned that it was managing an ongoing portfolio of $34.8 billion in such projects from different sectors of the economy.  It added that out of the total portfolio, $15 billion (43 percent) is deemed problematic.

Read more: Energy Security key for Pakistan’s progress

Most importantly, the meeting was told that about $3.3bn is the share of federal energy projects, out of which around 70 percent i.e., $2.3 billion is assessed as “problematic,” according to an official statement.

The Minister for Economic Affairs stated that while energy was arguably one of the most essential inputs for economic growth in order to sustain industrial and commercial operations, it was becoming a challenge.

An official mentioned that over 17percent losses and 10pc short recoveries in the power sector and 10-17pc system losses in the gas sector. It is an evident that the energy sector is raising questions on country’s stability.

He stressed the importance of addressing the issues of problematic projects as soon as possible, particularly those experiencing serious delays, to accelerate disbursements and progress. He highlighted the significance of focal ministries and implementing agencies setting milestones/deliverables with deadlines for continuous monitoring and preventing time and cost overruns.

Moreover, Economic Affairs Secretary Mian Asad Hayauddin proposed that the focal ministries hold monthly follow-up meetings with program execution agencies and stakeholders to ensure proper monitoring and prompt resolution of issues.