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PRESIDENT ALVI INVITES CEC FOR MEETING TO ‘FIX APPROPRIATE DATE’ FOR POLLS TODAY thursday, 24 august, 2023 i 6 safar, 1445
Says he is obliged under Article 48(5) of Constitution to appoint a date not later than 90 days
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ISLAMABAD
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ECP invites PPP, PML-N, PTI and JUI-F for discussions on matters regarding elections
staff report
RESIDENT Arif Alvi on Wednesday wrote to Chief Election Commissioner (CEC) Sikandar Sultan Raja, inviting him for a meeting to “fix an appropriate date” for general elections on Thursday (today). In a letter wrote to the CEC on Wednesday, Dr Arif Alvi cited the constitutional requirement for the president to decide a date for general elections within 90 days after the dissolution of the National Assembly (NA). In the letter, posted on the Presidency’s account on X, the president noted that the NA was dissolved on the advice of thenprime minister Shehbaz Sharif on August 9 — three days ahead of its mandated period. “By virtue of Article 48(5) of the Constitution of the Islamic Republic of Pakistan, the president is obliged to appoint a date not later than 90 days from the date of dissolution for the holding of general elections of the assembly”, the letter read. In view of this, he added, the CEC was invited to meet him today or tomorrow to set an “appropriate date” for elections. While the president has cited the constitutional provisions that elaborate on his role
in deciding the election date, a recent amendment to the Elections Act 2017 empowered the Election Commission of Pakistan to announce the dates for polls unilaterally without having to consult the president. Alvi’s invitation to the CEC also comes against the backdrop of the Election Commission of Pakistan having ruled out elections this year, following the notification of the latest 2023 digital census. Since the NA was dissolved three days
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before the end of its constitutional term, Article 224 of the Constitution mandates that elections be held within 90 days of the dissolution of the assembly. But at the same time, Section 17(2) of the Elections Act states that “the commission shall delimit constituencies after every census is officially published.” In line with this requirement, the ECP said last week the process of fresh delimitation of national and provincial assembly con-
stituencies was expected to be completed by December 14 — over a month beyond the constitutionally mandated deadline for conducting general elections. However, after the ECP’s announcement last week, a Dawn report quoted an official of the commission as saying that the electoral watchdog was not legally bound to “immediately” carry out fresh delimitation of constituencies after the official notification of census results. ‘PRESIDENT BOUND BY PM’S ADVICE’ Sharing his views on the president’s letter to the CEC, Chairman of Islamabadbased public policy think tank Pildat Ahmed Bilal Mehboob said it seemed that Alvi was aiming to exercise his prerogative under Article 48. However, the president was bound by the prime minister’s advice and could not independently exercise this authority, he said while speaking to Geo News. “If the president’s letter is based on the prime minister’s advice, it aligns with the Constitution. Otherwise, it deviates from the Constitution,” he added. “It is not the president’s discretionary power to set a date [for the elections].” On the recent amendment to the Elections Act, he said the law was secondary to the Constitution but again emphasised that
Big electric shock of Rs5.40 per unit hike on the cards
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Govt voices concern many consumers would refuse paying bills after huge hike ISLAMABAD
ahmad ahmadani
The government on Wednesday asked the National Electric Power Regulatory Authority (NEPRA) to recover Rs 5.40 per unit increase in power tariff from consumers over a six-month period in order to protect consumers from a huge electric shock and prevent a drop in the recovery of electricity bills. The shocking revelation came to light during a NEPRA’s public hearing where it was disclosed that the previous significant hike in the power tariff had caused shutdown of a number of industrial units which in turn resulted considerable drop in the demand for power distribution companies (DISCOs). Fearful of a similar scenario, the government voiced concerns that many power consumers would refuse to pay their bills with the newly imposed Rs 5.40 per unit hike in electricity rates. Presenting their apprehensions to the regulator (NEPRA), power division officials informed that that last year electricity consumers had resisted paying their electricity bills following a significant increase in electricity rates. And, this time to avoid such situation could happen, the regulator is requested to allow recovery of the hike in electricity rates in six months period instead of three months’ time to provide cushion to the power consumers from the impact of the massive hike in the electricity rates. Furthermore, the officials stressed that a long recovery period would not result in low recovery of electricity bills. The Central Power Purchasing Agency – Generation (CPPA-G) through a petition had sought increase in electricity rates by Rs 5.41 per unit on account of quarterly adjustments of DISCOs on account of variation in Power Purchase Price (PPP) for 4th Quarter of the FY 2022-23. A major portion of this increase was intended to recover capacity payments amounting to Rs 145 billion from those honest consumers who have been paying their electricity bills regularly while this sum would be allocated to those power plants that remained idle and did not produce electricity during that period.
During the course of public hearing, the CPPA-G officials highlighted that NEPRA had been previously approving the recovery of power tariff hike from 12 to 15 months. Based on this precedent, they advocated that this practice was already in place and the regulator should allow recovery of electricity rates during the six months period. They said that it would also result in electricity rates by Rs 3.55 per unit instead of Rs 5.40 per unit due to low consumption of electricity demand in winter season. The electricity bills are normally low during the winter season and therefore, the consumers would not feel shocks in electricity bills,” officials said. The officials also said that consumers were already paying Rs 1.24 per unit increase in electricity rates on account of quarterly adjustment that would end in September. They suggested to recover Rs 1.24 per unit from September and Rs 2.31 per unit increase starting from October. They said that it would be minor impact in electricity bills of the consumers. There was another shocking disclosure that power distribution companies (DISCOs) had sent out five billion units less to the consumers. This means that demand had been reduced during the period under review. It was informed that there were two factors that impacted demand of electricity. Weather had also impacted the demand. Secondly, the industry had shut down their businesses due to hike in electricity rates. The power regulator expressed serious apprehension over the apparent failure of Chief Executive officers (CEOs) of the DISCOs for the underutilization of electricity. It was further informed that each DISCO was drawing 600 to 700 MW less electricity from the system due to decreased demand while there were 3,50000 cases of connections pending. And, the regulator observed that growth projection was not realistic. It was informed that growth projection was made based on last year data when weather was too hot. However, regulator sought explanation of low sale of electricity during the period under review. Power regulator also noted with serious concerns
the president could not independently set an election date unless advised by the prime minister. He further disagreed with the ECP assertion to hold elections after a fresh delimitation of constituencies.“Personally, I find this interpretation unsatisfactory. I believe the Constitution mandates elections … From my perspective, delimitations are not constitutionally necessary.” Mehboob said he could see this matter “ultimately ending up in the Supreme Court”. ECP WRITES TO FOUR PARTIES FOR TALKS ON POLLS Meanwhile, the ECP has invited four political parties — the PPP, PML-N, PTI and Jamiat Ulema Islam-Fazl (JUI-F) — for discussions on matters regarding the upcoming general elections. The commission has invited the parties through four separate letters to the heads of these parties. The letters state that the ECP “is charged with the constitutional duty to organise and conduct elections in terms of Article 218(3) of the Constitution of the Islamic Republic of Pakistan and to make such arrangements as are necessary to ensure that the election is conducted honestly, justly, fairly and in accordance with the law and that corrupt prac-
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Demand for Pakistan’s rice surges as India mulls Non-Basmati export ban
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Question arises what is more important: foreign exchange reserves or affordable food? ISLAMABAD
Ghulam abbas
that sale of GEPCO had decreased despite the fact it had steel melter industry. The sale of IESCO also dipped by 14 percent and it had also steel melter industry. NEPRA said that it had raised serious concerns. Faisalabad company was also impacted despite having industrial units. However, CPPA-G officials said that industrial consumers were 367000 earlier that closed at 373000 consumers in July. “We can’t blindly stand numbers you are showing,” NEPRA officials said. Power regulator also raised concerns over recovery of hike in electricity bills during six months period. It said that such situation would impact the cash flow of the DISCOs to add into circular debt. Power regulator said that dollar had been indexed at Rs 286. “It does not mean inefficiency, overbilling and cost of bad governance should be passed on to consumers,” NEPRA observed. Amidst these revelations, the regulator acknowledged how structural difficulties would affect predictions of industry growth. The regulator highlighted that the current recovery path should not jeopardize the welfare of consumers by transferring inefficiencies and poor governance costs to them. The regulator also emphasized that the provincialization of DISCOS may not be a full solution and stressed that structural adjustments within the power sector are necessary for significant improvements.
The international rice market is witnessing a significant upheaval as India, a major global rice producer, contemplates a ban on non-basmati rice exports. This uncertainty has prompted a surge in demand for Pakistan’s rice, leading to increased offers and higher prices. International buyers are now turning to Pakistan for their non-basmati rice needs. INDIA’S POSITION IN THE RICE MARKET In 2022 India exported over 22 million tonnes of rice to the entire world. As the single largest exporter of white rice in the world, India control’s a massive 40% of the global market for rice providing different kinds of rice that many other countries in the world are heavily dependent on for their caloric intake. And this year the Indian government has put a ban on the export of all kinds of rice except the aromatic and high-end Basmati variety. The ban comes in response to soaring rice prices in India and a general food inflation crisis that has been brewing in the country. As a result, the international rice market suddenly finds itself short on more than 10 million tonnes of rice. With a global food crisis already about to reach crescendo because of the Russia-Ukraine war, rice importing countries and international organisations are suddenly faced with a concerning question: how will this massive shortfall of rice be met? Already the news of India’s rice ban has resulted in supermarkets facing panic buying all the way in the United States and other countries that rely on Indian rice. Some other countries that are also exporters may also follow suit with a ban to protect their own domestic markets.
‘Official’ and ‘actual’ rates emerge within open market rate of dollar
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Exchange companies’ association claims dollar being sold at Rs312 while actual rate in open market hovers around Rs315. Both rates indicate a gap with the interbank rate that fails to meet IMF criteria KARACHI
urooj imran
Amid the rupee’s spiraling descent, multiple rates for the US dollar are emerging within the open market as well. While the gap between the interbank rate and the open market is continuing to grow despite IMF requirements, exchange companies are also selling dollars on the open market at a much higher rate than quoted by the Exchange Companies Association of Pakistan (ECAP). According to ECAP’s latest rates on Wednesday, the US dollar is being sold at Rs 312 and bought at Rs 309 in the open
market, respectively. With the interbank rate of the dollar being reported at just under Rs 300, this would indicate a gap between the interbank and open-market rate of around 12. However, the reality is much different. Profit reached out to two exchange companies to find out the actual rates and availability. AA Exchange quoted a sell rate of Rs 313 and a buy rate of Rs 310. The company also pointed out that dollars were not available for sale. Separately, Habib Qatar International Exchange said dollars were available for sale at the rate of Rs 315 per dollar while the company would buy them for Rs 313 a dol-
lar. It also asked for the reason for buying dollars before confirming their availability. Largely it seems that the on-ground situation is that the dollar is selling at around Rs 315 in exchanges. Meanwhile, the rupee closed at an all-time low of Rs 299.64 against the US dollar in the interbank market, according to the State Bank of Pakistan (SBP). It is worth pointing out that the International Monetary Fund (IMF) has stipulated that the gap between the interbank and open market rates cannot be higher than a set percentage of 1.25% for more than five business days. At the current actual gap of around Rs 15.36 (with the interbank at Rs 299.64 and
the open market rate at around Rs 315) the percentage difference stands at just over 5.13%. At the rate quoted by ECAP (Rs 312) the difference is Rs 12.36. This means at this “official” gap rate the percentage difference is just over 4.12% which is still higher than the stipulated percentage. This means that if the rate of the dollar does not fall on the open market the interbank rate will have to catch up no matter what. It is important to note here that the difference in rates in the open market was more pronounced in the afternoon. According to the ECAP’s afternoon update – the association shares rates twice a day – the sell rate
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of the dollar was Rs 306.5 while the buy rate was Rs 303.5 To put these different rates into context and understand why they matter, it is important to understand the different currency markets. EXPLAINING THE GAP The interbank market, as the name suggests, is a market for banks. It is used by financial institutions to trade currency and currency derivatives with each other. These transactions can be on behalf of third parties done through banks; however, they are primarily done for the banks themselves. Since May 1999, Pakistan has been following a market-based flexible exchange rate system. As a result, the interbank rate is applicable to all foreign exchange receipts and payments. This is for the private and public sectors. The exchange rate depends on the demands and supply conditions in the domestic interbank.
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