Seminar in Public Policy
Assignment # 1 Public Policy Process Topic: Energy crises in Pakistan
Submitted by: Hina Arshad Chohan Registration # sp11-rba-011 Submitted to: Mr. Iram Khan
Dated: 11th March 2012
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Public Policy Process Step 1: Problem Identification
The problem I am focusing on is Energy crises in Pakistan. Pakistan is facing severe energy crises from last few years in Natural gas, Power and Oil, and it is expected to be worsening in next few years. Actors who are affected by this crisis and who may involve in resolving it are: Industries, businesses, house holds, drivers, and other people. As industries and businesses are shutting down due to this energy shortfall, life of house holds are getting disturb as children are unable to do their homework on time, house wives are unable to get done with their work, as when they are about to start washing machines, electricity goes off, similarly due to sui gas load shedding people are unable to cook food on time. Drivers have to wait in lines to get CNG for their cars and mostly they are unable to find it at all. Hence every one is disturbed. Media is also an actor as it creates awareness among people and it actually provides information.
Water and Power Development Authority (WAPDA), Peoples representatives and contractors are
some other actors. Other actors are obviously government and Ministry of Petroleum and Natural Gas, who make policies which may be against or in favor of resolution of crises.
Step 2: Agenda Setting Problem:
Among all the problems Pakistan faces, energy seems to be the most serious one. Every individual in Pakistan uses energy in one form or another and hence is directly affected by it. This energy deficit would obviously affect the Economy of Pakistan and will lead to inflation. Mismanagement, Ignorance, negligence, and lack of investment in energy development sector lead to this shortages in recent years. As a result, daily life has been suffered a lot across the country, causing the shutting down of hundreds of industries while leaving millions of people out of job. Energy Crisis is becoming more hostile in upcoming years. There is an anticipated short fall up to 50% because of boost in demand and supply of gas up to 3,000 MW. Total energy requirement of Pakistan would increase by 48% to 80 million tons of oil equivalent in 2011.
Pakistan imports energy to conquer the problem and keep up standard of living of people of Pakistan. The major deficit is projected in natural gas supplies. In 2006 Pakistan had 28 trillion cubic feet of natural gas reserves but due to rise in its demand it is expected to be exhausted in next few years. According to the estimates of Ministry of Petroleum, natural gas shortfall against committed supplies remained around 1.1 million cubic feet per day (MCFD) in January 2012 and will inflate to 1.4 MCFD in February and 726 MCFD in March. The energy shortage in the country is becoming worsened in coming years with gas shortfalls estimated to reach 2.5 BCFD in 2014-15, 3 BCFD in 2015-16 and 3.5 BCFD in 2016-17. Hence, the demand and supply gap is likely to skyrocket to 5 BCFD in 2020-21, unless major gas discoveries and developments are made. The Energy shortage, mainly due to the shortage of gas, has become persistent threat for Pakistan. Since 1990s Pakistan has been trying to turn up the TAPI and IP gas pipeline projects. The Turkmenistan, Afghanistan, Pakistan, India (TAPI), is a $7.6 billion gas pipeline project, expanding over 1680 kilometers from Turkmenistans gas fields to Afghanistan, Pakistan and ending at the India. Whereas, the Iran-Pakistan (IP) gas pipeline is devoted to bring 21.5 million cubic meters of the Iranian natural gas, per day to Pakistan expanding over the distance of 2100 kms.
Possible solution:
The IP gas pipeline project is essential for solving the worsening energy crisis that Pakistan is facing. Irans gas reserves are second largest in the world and Iran intends to export 8.7 billion cubic meters per year of the Iranian natural gas to Pakistan under the Iran-Pakistan gas pipeline project. This project will be financed through public-private partnership and will greatly benefit Pakistan. Maximum daily gas transfer capacity through 56-inch pipeline has been given at 110 million cubic meters and power generation capacity estimated to 5,000 megawatts approximately equal to Pakistans recent energy deficit. Iran has completed the construction of 900 km out of the 1100 km of the pipeline in Iran at a cost of $700 million, while Pakistans contribution of nearly 1000 km is yet to be built. Iranian Consul General Mohammad Hossain Bani Asadi said that; Iran has assured Pakistan that it is sincerely working to provide assistance and support for overcoming the energy crisis and strengthening bilateral ties between the two countries. Asadi asked Pakistan to start work on import of gas as Iran had already laid the pipeline to the border. He assured that Iran is taking zealous interest in minimizing energy deficiency in Pakistan.
The IP gas pipeline project seems to be superlative deal for the energy lacking country like Pakistan, so government of Pakistan should engage in this deal to overcome this shortage.
Limitations:
The distressing thing is that these attempts remain confined to chronic American objections to Pak-Iran collaboration in addition to the political insecurity and the consequential instability in Afghanistan and some parts of Pakistan. Actually United States wants to isolate Iran and cause as much harm as possible to compel them to give up their nuclear program. For the reason, united States use its pressure tactics to keep Pakistan away from its gas pipeline project with Iran. Even though they are well aware of the problems faced by Pakistan caused by energy crisis, the US has constantly opposed the project. United States also proposed to fund the multi-billion dollars gas pipeline project known as TAPI in order to keep Pakistan away from the IP gas pipeline deal despite the fact that IP project promises four times cheaper energy as compared to TAPI pipeline project. The important thing is that Pakistan should prioritize its own interests first and go for the proposed pipeline from Iran to meet its energy needs more willingly than gratify US desires and ambition. So the Government of Pakistan, Ministry of Petroleum and Ministry of Finance along with other actors should seriously design and formulate a policy in order to address this severe energy crisis.
Step 3: Policy Formulation
For policy formulation inputs will be provided by ministry of petroleum, Analyst and Researchers, media, contractors and peoples representatives. The parties who are responsible for formulating this policy are Ministry of Petroleum and Natural Resources (MPNR), Ministry of Finance under Ministry of Foreign Affairs and the policy will be approved by parliament. The Federal Government for this purpose makes legislation for Islamabad parliament.
Step 4: Policy Legitimation
This policy will benefit Pakistan not temporarily but in long run, as through this project maximum daily gas transfer capacity through 56-inch pipeline has been given at 110 million cubic meters and power generation capacity estimated to 5,000 megawatts approximately equal to Pakistans recent energy deficit.
Further more this project is cheaper then other alternative available options (TAPI). And anther thing is that Iran is interested in minimizing energy deficiency in Pakistan. So Government of Pakistan should also cooperate and protect their nations interests rather then fulfilling US demands.
Step 5: Policy Implementation
The Ministry of Petroleum and Natural Resources (MPNR) is the Pakistan governmental agency who is responsible for implementing energy policy. In this case ministry of Foreign Affairs also has to play its role as this policy decision involves trade with other country that is Iran.
References:
http://www.thenews.com.pk http://www.expresstribune.info/ http://haroonhaider.com
