Islamabad : A meeting of the Senate Standing Committee on Economic Affairs was held under the chairmanship of Senator Saifullah Abro, where external funding arrangements, World Bank loans, and their utilization were reviewed in detail. The Committee expressed displeasure over the failure of relevant Departments to provide complete information and directed that comprehensive records be presented in the next meeting.
The Committee took up the matter of a loan obtained by Sui Southern Gas company Limited (SSGCL) from the World Bank. Officials from the Petroleum Division informed the Committee that SSGCL had secured a US$ 200 million loan in 2012 for the Natural Gas Efficiency Project. Chairman Committee Senator Saifullah Abro questioned where the loan amount had been utilized. Petroleum Division officials informed that company did not utilize the loan and that it was cancelled in 2014.
Reacting strongly, Senator Saifullah Abro said that it was unacceptable for a company to ignore negotiations and agreements made by the government with the World Bank, questioning whether it considered itself a private entity above accountability. He said that refusal to utilize a loan after obtaining it was a serious matter and that responsibility will be fixed.
Senator Syed Waqar Mehdi also took serious notice of the matter and inquired whether complete project details had been submitted to the lending agency, and on what grounds they refused to work on the local components of the project. He further suggested that damages may be imposed on SSGCL in this regard.
The Chairman Committee directed the EAD to ensure the presence of the Managing Director and the management of SSGCL at the next meeting, along with complete documentation, including the latest progress of the project, details of incumbency, and a list of officials involved in the project. The Secretary, Economic Affairs Division, observed that the cancellation of a loan after it has been secured is a matter of embarrassment.
While discussing the ongoing projects related to Education Sector under World Bank,the Committee reviewed a US$ 233 million loan obtained during the Covid-19 period for the education sector under the Actions to Strengthen Performance for Inclusive Responsive Education (ASPIRE) program. Officials from the Economic Affairs Division (EAD) informed the committee that the loan was acquired and utilized by the Ministry of Federal Education and Professional Training. During the pandemic, assistance was extended to various districts to promote online education.
Senator Saifullah Abro expressed displeasure over the absence of the Secretary Education from the meeting. He directed that an Additional Secretary or Joint Secretary level officer be summoned and described the Ministry’s conduct as non-serious. He instructed the EAD to issue a letter to the Ministry of Education and Professional Training over its unprofessional attitude and warned that such conduct could impact future consideration of foreign loans.
During the meeting, Senator Syed Waqar Mehdi asked on what basis the districts were selected for assistance. Officials stated that the list had been prepared by the Planning Commission, taking into account regional backwardness and the number of out-of-school children. According to officials, in Sindh 200 additional classrooms were constructed under the program, 120 schools were provided with digital classroom facilities, and 106 schools were solarized.
Senator Saifullah Abro referred to Shaheed Benazirabad Division in Sindh province and questioned whether officials had visited the area, noting that it is considered one of the more developed districts of the province. He emphasized that the EAD must establish strict checks and balances for such projects, raise the criteria for acquiring new development loans, and ensure effective monitoring of loan utilization. He also sought complete details of the procurement and tendering process for the project from all provinces and directed the EAD to submit the required information to the Committee within two days.
The issue of non-representation from Khyber Pakhtunkhwa was also raised. On inquiry, officials informed the Committee that no representative from the province had attended the meeting. The Chairman Commitee directed that a letter expressing displeasure be written to the Chief Secretary of Khyber Pakhtunkhwa. After detailed deliberations, the Committee unanimously decided and recommended that concerned Secretaries of the departments and the Project Directors attend the next Committee meeting. The Committee further recommended that details of expenditures incurred to date, along with photographs of newly constructed classrooms and the procurement of furniture under the project in all provinces, be shared with the Committee.
The Committee reiterated its concern over the failure to provide full details regarding externally funded projects and directed the EAD to present a comprehensive briefing in the next session. Senator Saifullah Abro stated that entire nation bears the burden of loan interest and noted that some projects take ten to fourteen years to complete. He stressed that ongoing projects financed through previous loans should be completed before acquiring new ones.
Officials from the EAD maintained that delays in securing funding could lead to cost escalations in development projects. They informed the committee that the division conducts quarterly reviews of loan-funded development initiatives. However, the chairman directed the division to establish a dedicated desk to monitor loans extended to provinces and to ensure strict implementation of the committee’s directives, stating that the existing mechanism was not delivering satisfactory results.
At the conclusion of the meeting, the committee recommended refraining from contracting new external loans for various projects and underscored the need to ensure financial discipline, transparency, and effective oversight to safeguard national interests and minimize the burden of debt on the public.
