Power outages threaten industrial cooperation at Rashakai SEZ, Chinese firm warns

The Rashakai Special Economic Zone Development & Operations Company (RSEZDOC) has issued a warning to the government, stating that unresolved power issues at the Rashakai Special Economic Zone (SEZ) could jeopardize industrial cooperation between China and Pakistan. 

According to a news report, in a letter addressed to the Secretary of the Power Division, RSEZDOC’s Chief Executive Lyu Ming expressed serious concerns about the ongoing power shortages at the SEZ, which are significantly disrupting operational activities and hindering investment promotion efforts. 

RSEZDOC emphasized that the Rashakai SEZ, the only SEZ under the China-Pakistan Economic Corridor (CPEC) operated by a Chinese entity, has received considerable support from both the Chinese and Pakistani governments. The unresolved power issues, however, pose a critical threat to the SEZ’s success and could further harm industrial cooperation between the two countries if not addressed promptly.

According to RSEZDOC, the current temporary power supply is inadequate and unstable, affecting the production capacity of businesses within the SEZ and deterring potential investors. The company has called on the Power Division to expedite the energisation of the internal distribution network to resolve these issues.

The letter, which was also shared with Planning Minister Ahsan Iqbal, highlighted the withdrawal of major Chinese investors, including Alice, due to the zone’s inability to meet their power demands.

The situation was discussed at a meeting convened on August 21 by the Minister for Planning, Development, and Special Initiatives. The meeting involved key stakeholders such as the Ministry of Energy, the National Electric Power Regulatory Authority (Nepra), the Central Power Purchasing Agency (CPPA), and the Peshawar Electric Supply Company (PESCO).

The letter also noted that the Planning Minister had directed the Power Division to finalize and report a policy decision within five days to find a permanent solution to the ongoing power problems. However, RSEZDOC expressed concern that it was not included in detailed discussions regarding these solutions.

The company urged the Ministry of Energy to take into account the practical challenges faced by the Rashakai SEZ and to communicate a viable solution as soon as possible to prevent further investor withdrawal and secure the future of the zone.