Islamabad, Oct 31: Chief of Army Staff General Asim Munir has been urged by German envoy Alfred Grannas to assist in renegotiating Siemens’ contract termination.
Siemens owns a 26% share in Rousch Pakistan Power Limited (RPPL).
According to Express Tribune, the German government has rejected the contract termination
but is amenable to closure provided Pakistan agrees to six requirements.
Siemens’ long-standing collaboration in Pakistan’s electricity sector was in danger and was undermining investor confidence, the German envoy wrote to Asim Munir.
According to the present terms of the proposed settlement,
RPPL must give the plant to the federal government for $1 in return for Rs. 2.8 billion for continuing maintenance and Rs. 5.5 billion in early termination compensation.
Siemens has specific requirements for resolving important operational and financial issues. Prior to the plant handover,
the Finance Division and central bank provided guarantees that settlement monies, dividends, and other payments would be transferred to German accounts without hiccups.
As a goodwill gesture, Siemens also wants to resolve a sales tax dispute with Pakistan’s Federal Board of Revenue,
Indemnify its board members from potential claims and tax penalties and pay out Rs. 3.1 billion in unpaid dividends right away.
The ambassador voiced worries about the possible harm to economic ties between Germany and Pakistan
And pointed out that Siemens has not been able to obtain a sufficient return on investment in Pakistan due to many contract renegotiations since 2000.
