KP plans to list hydel power project, transmission company on stock market

An unprecedented development may be about to take place at Pakistan’s capital market as the provincial Khyber Pakhtunkhwa (KP) government plans to sell stakes in the province’s power plants, tourism resorts and transmission network through listings on the Pakistan Stock Exchange (PSX) and public partnerships.

In an exclusive interview with Nukta at the Pakistan Stock Exchange, KP Finance Minister Muzammil Aslam iterated that the province promises good returns for investors.

He highlighted that numerous projects are planned, which can be funded through the capital market by issuing bonds and listing projects for completion or initiation.

One of the main projects involves laying transmission lines. This initiative will benefit not only the KP government but also the federal and private sectors by facilitating the installation of hydel projects.

Aslam mentioned a 600 MW project funded by the Asian Development Bank, which will produce electricity at a much cheaper rate compared to the current industrial and consumer tariffs.

The expected cost of electricity could be between PKR 25 to 27 per unit, significantly lower than the current rates of PKR 40 per unit for industries and over PKR 60 per unit for consumers. These transmission lines will also encourage other companies to set up hydel power plants in the area.

Aslam pointed out that tobacco, an agricultural product, has not been devolved, and its revenue generation remains with the federal government.

The federal government collects PKR 500 billion annually under federal excise duty and sales tax. The province has long demanded that this collection be transferred from the federal government to the provinces.

During his presentation, the KP finance minister addressed the issue of pensions, describing it as a thorny problem. He revealed a plan to convert PKR 200 billion parked in the pension account into a pension fund that could be listed on the stock market.

Additionally, Aslam disclosed two other initiatives: the creation of a provincial electricity regulatory body to operate along the lines of the National Electric Power Regulatory Authority and the launch of Takaful Insurance.