Chinese Investment to Resolve Energy Crisis, Build Infrastructure in Pakistan

[WishLivePak]

These investment that are coming in... Will they deflate rupee value? Since dollars will be used to pay for labor etc. At the same time, we're taking loans.

So how will the rupee work out? $43 billion is big amount.

 

[boke]

如果我没看错的话，对于中国投资巴基斯坦电力建设有不少巴基斯坦国民存在疑虑，有点困惑，因为巴基斯坦的在吸收对外投资减少和电力短缺方面的现实是不争的，我相信中巴两国政治高层的智慧，投资巴基斯坦电力建设的决定肯定是双赢的决定，另外，也不仅仅是交易我想，中国的国民对巴基斯坦同样怀有深厚的感情，请不要简单的把这个看成一场赤裸裸的交易！

 

[mr.robot]

Until the official details of projects are out, the story should be read with a grain of salt. In any case, 2-3 years is far from reality. We don't even have the proper distribution and grid system for existing power capacity rather this much new capacity. Which hydro and coal projects can be completed in 2-3 years? The proposed coal projects in Punjab are not practical at all due to environmental effect primarily. Second, we don't have the infrastructure for transportation of such huge amounts of coal.

IMHO, it is a long term commitment and project.

 

[WAJsal]

Until the official details of projects are out, the story should be read with a grain of salt. In any case, 2-3 years is far from reality. We don't even have the proper distribution and grid system for existing power capacity rather this much new capacity. Which hydro and coal projects can be completed in 2-3 years? The proposed coal projects in Punjab are not practical at all due to environmental effect primarily. Second, we don't have the infrastructure for transportation of such huge amounts of coal.

IMHO, it is a long term commitment and project.

something doesnt add up why would u set up a plant far away from the raw product it will only result in further cost

 

[mr.robot]

something doesnt add up why would u set up a plant far away from the raw product it will only result in further cost

Oye Robert Downey ka avatar lganay walay Amreki agent! Pak-Cheen dosti ki champion government ko question kartay hou.
Yeh kyun pochtay hou ke jab Sahiwal main plant lagay ga toh duniya ka behtreen chaawal aur makki nahi uggay gi. Jab rahim yar kahn aur muzzafargarh main plant lagay ga toh duniya ka behtreen aam aur kapas nahi ugay gi. Nah ugay. Kashktaar mar jaaye lekin Mian Mansha ki machinery chalni chahiye. Samjhay...........

 

[WAJsal]

Oye Robert Downey ka avatar lganay walay Amreki agent! Pak-Cheen dosti ki champion government ko question kartay hou.
Yeh kyun pochtay hou ke jab Sahiwal main plant lagay ga toh duniya ka behtreen chaawal aur makki nahi uggay gi. Jab rahim yar kahn aur muzzafargarh main plant lagay ga toh duniya ka behtreen aam aur kapas nahi ugay gi. Nah ugay. Kashktaar mar jaaye lekin Mian Mansha ki machinery chalni chahiye. Samjhay...........

agent lagtan houn kya i wish but not american yar wt i dont get is they have to transport coal all the way to punjab muft ka paisa araha hay kya

 

[mr.robot]

agent lagtan houn kya i wish but not american yar wt i dont get is they have to transport coal all the way to punjab muft ka paisa araha hay kya

They are most likely being set up for the joint ventures of Mian Mansha and House of Sharifs. Who cares if they are feasible or not? In Sindh, Mian Mansha won't feel easy in presence of House of Zardaris..... They would want their share as well

 

[WAJsal]

They are most likely being set up for the joint ventures of Mian Mansha and Sharif Family. Who cares if they are feasible or not? In Sindh, Mian Mansha won't feel easy in presence of Zardari and Co..... They would want their share as well

thought so

 

[mr.robot]

Only if the cost per unit billed to customers is reduced as a result of reduced cost of production, and even then it would not affect the debt already accrued (over PKR 700 billion and counting).

Exactly. It is more of a issue related to mismanagement, theft and capacity of already installed distribution lines.

If the cost of production drops faster than the consumer rates charged, then the gap will go down significantly over time. That's the entire logic of shifting the mix from oil to coal and hydel.

Haq's Musings: Pakistanis Suffer Load-shedding While Power Companies' Profits Surge

By that logic, price of oil is in free fall. Why isn't electricity's?

 

[RiazHaq]

@orangzaib

Thar project: Chinese lenders refuse to accept sovereign guarantees – The Express Tribune

These reports pre-date the recent Pak-China agreements signed in Beijing.

Haq's Musings: China Deal Could Set New FDI Records, End Energy Crisis in Pakistan

 

[RiazHaq]

Exactly. It is more of a issue related to mismanagement, theft and capacity of already installed distribution lines.


By that logic, price of oil is in free fall. Why isn't electricity's?

Power sector theft and mismanagement have been there for long but the circular debt issue is more recent...mainly precipitated by huge run up in energy prices and gas shortages.

Neither oil price nor electricity rates are in free fall anywhere in the world but both are coming down.

 

[Stephen Cohen]

These reports pre-date the recent Pak-China agreements signed in Beijing.

Haq's Musings: China Deal Could Set New FDI Records, End Energy Crisis in Pakistan

Dear RiazHaq
You should know that these high profile visits dont lead to the signing of big deals

the discussions on Big deals are just initiated during such visits
Deals are finalised after many rounds of negotiations between officials

This is true of every country every where in the world

Pakistani leaders just visit China for reassurance

The basic problems of Pakistani economy and energy sector are far too
complex ie

1 No manufacture of indigenous equipment
2 Fuel problems
3 shortage of technical manpower who install the plant and equipment
4 Shortage of forex reserves which is needed for repatriation of profits
5 Internal problems such as recovery of dues and circular debt

China is asking for very healthy rate of return which Pakistan cannot afford

And this is not the first time such big announcements
of several billions of investments have been made

The implementation of such MOUs is the real thing

 

[mr.robot]

Power sector theft and mismanagement have been there for long but the circular debt issue is more recent...mainly precipitated by huge run up in energy prices and gas shortages.

Neither oil price nor electricity rates are in free fall anywhere in the world but both are coming down.

What else would you call a free fall? And it is expected to go down further.

 

[RiazHaq]

View attachment 156769
What else would you call a free fall? And it is expected to go down further.

Talk about retail prices, not wholesale on world markets. Prices at the pump are down about 10% which is good but not comparable to the crude oil price decline of over 20%. There's always a significant lag between source and retail prices.

Besides, electricity rates are not declining anywhere in the world. In fact, elect rates are rising every year, though more slowly than in the past.

The problem in Pakistan is that the rates have always been and continue to be much lower than the costs of production and delivery of electricity. Hence the gap and the circular debt.

 

[RiazHaq]

Dear RiazHaq
You should know that these high profile visits dont lead to the signing of big deals

the discussions on Big deals are just initiated during such visits
Deals are finalised after many rounds of negotiations between officials

This is true of every country every where in the world

Pakistani leaders just visit China for reassurance

The basic problems of Pakistani economy and energy sector are far too
complex ie

1 No manufacture of indigenous equipment
2 Fuel problems
3 shortage of technical manpower who install the plant and equipment
4 Shortage of forex reserves which is needed for repatriation of profits
5 Internal problems such as recovery of dues and circular debt

China is asking for very healthy rate of return which Pakistan cannot afford

And this is not the first time such big announcements
of several billions of investments have been made

The implementation of such MOUs is the real thing

We'll just have to wait and see how much of it is executed, though I do know that PMLN is better at execution than the previous PPP govt whose performance was horrible.

As to Chinese equipment, money and personnel, it's true everywhere, including your country. There are tens of thousands of Chinese workers building power plants in India today.

Chinese are now supplying equipment for about 25% of the new generating capacity India is adding to its national grid, up from almost nothing a few years ago. There are thousands of skilled Chinese expatriates at Indian plant sites, along with Chinese chefs, Chinese television and ping pong.

Haq's Musings: Soaring Chinese Imports and Twin Deficits Worry India