ISLAMABAD: In the backdrop of invoking sovereign guarantees, the protesting Independent Power Producers (IPPs) are likely to get their payable dues from the proceeds of privatization.
According to reports, the decision in this regard was reached at a recent meeting on energy sector held with Prime Minister Nawaz Sharif in the chair.
It is to be noted that 25 IPPs have claimed that they have owed almost Rs 270 billion to government and seven IPPs, formally notified the government about invoking sovereign guarantees due to non-payment of dues amounting to Rs26 billion by Wapda on account of power purchased from the IPPs, while another three IPPs have also informed the govt of invoking sovereign guarantee in respect of an amount of Rs14 billion. This amount if not cleared by December 16, as expected, will result in a total sovereign default of Rs 40 billion.
The reports said that lack of an adequate response from the government has resulted in a serious liquidity crisis for the IPPs, leaving them with no other option but to call the sovereign guarantee, which will be followed by shutting down the power plants.
It is to be recalled that the present government cleared circular debt amounting to Rs480 billion after coming into power.
