SHANGHAI: President Asif Ali Zardari on Monday assured Shanghai Electric Power Company that any outstanding issues with Pakistan would be resolved amicably as he invited the firm to expand investment in the country’s energy infrastructure.
The assurance came days after Shanghai Electric decided to terminate its offer to acquire up to 66.4 per cent of K-Electric Ltd, citing changes in Pakistan’s business environment. The company said that since initiating the major asset purchase, it had complied with all relevant laws and actively promoted the transaction, but the counterparty failed to meet conditions precedent.
The firm said liquidity constraints in Pakistan’s power sector and shifts in its own international development priorities had rendered the transaction unfeasible.
KE remains the sole generator, transmitter and distributor of electricity for Karachi and adjoining areas. It was privatised in 2005, and Shanghai Electric had agreed in 2016 to buy a controlling stake from Abraaj Group for $1.77 billion. The deal never closed due to regulatory hurdles and mounting circular debt.
During his visit to Shanghai Electric’s headquarters, President Zardari met Chairman Wu Lei and toured the company’s facilities.
A statement issued by the Pakistan Peoples Party said the president invited the firm to explore investment in modernising Pakistan’s transmission and distribution network. He reiterated Islamabad’s commitment to resolving pending matters in the spirit of mutual cooperation.
The president thanked Shanghai Electric for contributing to Pakistan’s energy sector, job creation and socio-economic development. He also reaffirmed the government’s commitment to enhancing security arrangements for Chinese workers in Pakistan. Shanghai Electric CEO Lin Jigen expressed gratitude to the authorities for existing measures.
Company officials briefed Zardari on Shanghai Electric’s operations in Pakistan, including work in Thar coal, nuclear energy and coal-fired power plants. The president stressed the importance of the Thar coal project and highlighted the potential of coal-gasification.
He also witnessed the signing of a Memorandum of Understanding (MoU) between MFTC Coal Gasification & Manufacturing (Pvt) Ltd and Sino Sindh Resources (Private) Ltd/Shanghai Electric for the establishment of a coal gasification plant in Thar.
According to officials, the project will be the first coal gasification and fertiliser venture based on Thar coal, designed to meet Pakistan’s energy requirements and support the agriculture sector.
President Zardari was accompanied by First Lady Bibi Aseefa Bhutto-Zardari, PPP Chairman Bilawal Bhutto-Zardari, Senator Saleem Mandviwalla, Sindh Information and Transport Minister Sharjeel Memon, Sindh Planning and Energy Minister Syed Nasir Shah, China’s Ambassador to Pakistan Jiang Zaidong, and Pakistan’s Ambassador to China Khalil Hashmi.
