Editorial : Major overhaul - Tuesday, April 19, 2011

The government appears to have decided that there is no way out of the current crises it faces other than to go for a major overhaul of the oil and gas sector. The energy shortfall in the country and all kinds of related problems are just one aspect of this mammoth problem. The decision comes after Dr Asim Hussain, who resigned in 2009 citing personal reasons, returns as adviser to the prime minister. At a meeting chaired by the PM it has been decided that there can be no getting away from the need to expand production and ensure oil and gas are more evenly distributed among consumers, especially those in the industrial sector. Some tough decisions have been taken. Prime Minister Yusuf Raza Gilani has decided, on the advice of Dr Hussain, to immediately fire the heads of all the oil and gas companies and orders to this effect have been given to the Petroleum and Natural Resources Ministry. Dr Hussain has also made it clear that court cases need to be pursued aggressively and circular debt reduced at all costs. To make all this possible it has also been decided that the new heads of organisations that include the Pakistan State Oil, the Sui Southern Gas Company, the Sui Northern Gas Pipelines Limited and the Oil and Gas Development Company Limited will be brought in from overseas. The argument goes that the expertise required to restructure the sector is simply not available within the country. Other changes in the working of the organisations are also envisaged. The Sui Southern Gas Company and the Sui Northern Gas Pipelines Limited will, for example, be made responsible for the distribution of LPG.

These moves will arguably create a stir in the country. It is hard to assess if the import of heads is truly necessary or whether the high-salary packages these individuals are certain to be offered will only add to the fiscal problems we face in this sector. There is also reason to believe the move comes as a direct result of the talks in Washington between Finance Minister Hafeez Shaikh and the IMF, where the issue of reforming the energy sector is reported to have come up strongly. There can, however, be no doubt that urgent improvement is needed in the running of the crucial energy sector which quite literally keeps the country moving. We wish reform had come sooner, perhaps a year and a half ago when proposals in this regard were first made. Matters should not have been allowed to deteriorate to this degree. Now we can only hope that things can be salvaged; that it is not too late to do so and that the improvements that are so essential to our future can come about as the process of putting things in order begins. 

Source : http://thenews.com.pk/TodaysPrintDetail.aspx?ID=42503&Cat=8

No comments:

Post a Comment