Government Clears First Installment of Rs 89bn to 20 IPPs

Right before the budget, the federal government has completed the first installment of Rs 89 billion to 20 Independent Power Producers (IPPs) which is about 40% of the outstanding amount.

Sources said the federal government has paid some Rs 89.2 billion to IPPs as the first installment of liabilities amounting to Rs 403 billion.

The payment is in line with the agreement signed with 46 IPPs in February this year.

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Some 6 of 20 IPPs -receivers in the first installment- were set up under 1994 power policy labeled as controversial by the incumbent Pakistan Tehreek-e-Insaf (PTI) government.

Similarly, two of them were set up before 1994 and 12 IPPs make renewable energy using wind, solar, and bagasse.

Sources told News360 that the transaction has been completed in the equal dividends of cash, five years’ Sukuk bonds and 10 years’ Pakistan Investment Bonds (PIBs).

The payments were originally meant to be made by March but the process was delayed as National Accountability Bureau (NAB) had decided to peruse the deal between IPPs and the federal government.

Sources have confirmed that the finance division has completed transactions in coordination with relevant organizations and departments including the State Bank of Pakistan (SBP) and the power division.

It added that the remaining installment of 60% will be paid to IPPs within the next six months in an identical fashion.