Premier withdraws GIDC ordinance, directs AG to move Supreme Court for urgent hearing

Prime Minister Imran Khan. – File Photo

ISLAMABAD: Prime Minister Imran Khan withdrew on Wednesday the Ordinance related to the amnesty in Gas Infrastructure Development Cess (GIDC), according to a statement released from the PM’s Office.

The statement mentioned that the prime minister made the move in the interest of transparency and good governance.

The PM has also directed the Attorney General to move an application for urgent hearing in the Supreme Court, so the matter is decided according to the law and Constitution.

It is pertinent to mention that the total amount in limbo due to GIDC litigation is about Rs417 billion, from January 2012 until Dec 2018.

“An Ordinance was issued with a view to recover fifty percent of the stuck revenue by way of an out of Court settlement after consultation with the industry,” read the statement about the GIDC Ordinance which created controversy.

In the same statement, the PM also cautioned the nation that the decision could come either in favour or against it.

“However, the Prime Minister wishes to inform the nation that going to the Court carries a risk because the decision could go either way. This means that the government could get the whole amount or could lose it all and possibly forgo any prospects of future revenue collections under this head. Also on top on this, the government could be saddled with the burden of administering refunds of approximately Rs. 295 Billion of the principal amount,” it added.

The GIDC was imposed as a levy by the Pakistan Peoples’ Party (PPP) government in 2011 on gas consumers in the industrial sector. The money collected was to be used for the construction of infrastructure projects such as the Iran-Pakistan pipeline, the Turkmenistan-Afghanistan-Pakistan-India pipeline and other the Liquefied Natural Gas (LNG) projects.

The PTI government waived off approximately Rs208 billion in GIDC through a presidential ordinance with effect from August 28. As per a copy of the promulgated ordinance, influential industrialists, and owners of fertilizers, CNG and Captive Power Plants, K-Electric, Gencos and Independent Power Producers (IPPs) will pay half cess of the amount collected from May 22, 2015 to December 21 2018.