Pakistan will challenge the heavy fines imposed on it by a World Bank arbitration court – International Centre for Settlement of Investment Disputes (ICSID) – in the Reko Diq and Karkey power rental cases, says Federal Minister for Power Omar Ayub Khan.
Addressing a press conference in Islamabad, Khan said ICSID had imposed a fine of $6.2 billion in the Reko Diq case and $1.2 billion in the Karkey power rental case. The country can not afford such huge fines, he said. In fact, no developing country can afford heavy fines as the assets of some defaulting countries had already been confiscated in the past.
He said Rousch company was seeking local mediation while 11 other companies have opted for international mediation.
Questions were being raised on Rousch Company’s local mediation. Rousch Power Company was a project of 425 MW power. “Thorough investigations have revealed that the case of Rousch was genuine and it could win the case,” he said.
The minister said that the Pakistan Muslim League-Nawaz government had decided an out of court settlement of Rousch in an Economic Coordination Council meeting held in 2017.
PTI, he said, believed in merit. The incumbent government wants to resolve the power sector issues, he claimed, adding that this move would bring foreign investment and create employment opportunities in the country.
“Transparency and merit is the government’s top priority,” the government official said. He said that the previous government put the burden of extra charges on Independent Power Producers (IPPs), which compelled them to go for local and international arbitration.