Rental power plants deals signed by govt are illeg
Last Updated: Friday, March 30, 2012, 23:32
Islamabad: Pakistan's Supreme Court on Friday declared all contracts signed by the government for rental power plants as illegal and directed authorities to take legal action against those responsible for clearing the projects, including a close aide of President Asif Ali Zardari.

Zardari's aide Raja Parvez Ashraf was Power Minister when contracts were signed for several rental power projects, which were part of the Pakistan People's Party-led government's strategy to overcome a crippling energy shortage.

Though he was dropped during a cabinet reshuffle last year, Ashraf is close to Zardari and advises him on party matters.

The apex court began investigating the rental power plants (RPPs) in 2009 following a complaint of corruption from PML-Q parliamentarian Makhdoom Faisal Saleh Hayat. At the time, Hayat was in the opposition but his party is now part of the ruling coalition and he is the Housing Minister.

A two-judge bench headed by Chief Justice Iftikhar Chaudhry said in its order that the RPPs were a "total failure" as they produced only 120 MW of electricity.

The bench said the government had committed illegalities by paying a 14 per cent advance payment of billions of rupees to the bidders for RPP contracts.

The apex court cancelled the contracts signed by the government with nine RPPs, saying they violated the law and were "non-transparent, illegal and void ab initio".

All persons responsible for clearing the contracts "are liable to be dealt with for civil and criminal action in accordance with law", the order said.


First Published: Friday, March 30, 2012, 23:32

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